MILWAUKEE — Johnson Controls Inc. reached a definitive agreement with the Canada Pension Plan Investment Board to acquire Air Distribution Technologies Inc. (ADTI), an independent provider of air distribution and ventilation products, for approximately $1.6 billion.
Air Distribution Technologies produces a broad range of air distribution products under well-known brands such as Ruskin Co., Titus, Hart & Cooley Inc., Krueger-HVAC, PennBarry, and Tuttle & Bailey, among others.
“This investment expands Johnson Controls’ position in the buildings space with additional products that are complementary to our existing HVAC offerings,” said Alex Molinaroli, chairman and CEO, Johnson Controls. “It reflects our stated commitment to invest in the buildings business as a growth platform and further enhances our offerings and channels.”
Dave Myers, president, building efficiency, Johnson Controls, said this announcement paves the way for greater access to complementary products from two leading companies in the buildings business for HVAC contractors.
“ADTI customers will have undisrupted access to the products and brands they have come to expect,” Myers said. “To ensure this, ADTI will continue to function as a separate business, maintaining its focus on its valuable distribution channels and employees. ADTI’s products will continue to be sold through sales representatives and distributors, or to HVAC OEMs, as they are today. With the addition of ADTI to the Johnson Controls family, ADTI will get the full benefit of a multi-industrial company that will invest in the development of its product lines, and be supported by an engaged and productive workforce dedicated to customer service.”
Molinaroli said this new channel will provide an important growth platform for Johnson Controls as it continues to pursue additional investments in new products and increases its worldwide market coverage.
Within the Johnson Controls portfolio, ADTI will be aligned under the building efficiency platform, where it will operate with its own brands, distribution channels, and employees. The combination of the two companies will be jointly guided by Johnson Controls and ADTI leadership.
“Naturally, we are excited to move forward with ADTI because it is well-respected in the industry, offers the highest quality product brands, and has long-standing relationships with the top distributors/representatives in most North American markets,” Myers said.
The acquisition is subject to limited conditions and is expected to close by the end of July. Johnson Controls was advised by Goldman Sachs on strategic and financial aspects and Cleary Gottlieb Steen & Hamilton as legal representatives for this transaction.
Myers said this acquisition reflects Johnson Controls’ commitment to future growth.
“We are increasing the value we offer to our customers every day,” Myers said. “In this case, we are investing in extended product offerings and new channels to ensure growth and continued market leadership through joint leadership with ADTI.”
Information courtesy of Johnson Controls Inc.; www.johnsoncontrols.com.
Publication date: 5/5/2014