NORTH ANDOVER, Mass. — Watts Water Technologies Inc. has announced the signing of a definitive agreement to acquire AERCO International Inc., a portfolio entity of The Riverside Co., in an all-cash transaction. The acquisition of AERCO is expected to close before the end of this year subject to customary closing conditions.
AERCO is a manufacturer of a range of high-efficiency commercial boilers and water heaters. The company is based in Blauvelt, New York, and its products are distributed primarily in the United States for the commercial market.
AERCO’s trailing 12 months sales through September approximated $100 million. Under the terms of the purchase agreement, Watts expects to pay $264.5 million in cash to purchase 100 percent of the share capital of AERCO on a debt/cash free basis. The purchase price is subject to a customary net working capital adjustment. Watts intends to fund the transaction with borrowings under its credit facility.
Robert J. Pagano Jr., chief executive officer, said, “Acquiring AERCO will allow us to expand our product breadth to the strategically important adjacency of heat and hot water offerings. AERCO is a recognized leader in the fast growing market for high-efficiency boilers and hot water heaters, with solid operating margins and attractive opportunities to continue its strong growth. AERCO’s products complement our existing portfolio, strengthening our ability to provide a total solution for our customers. With our existing international footprint, we also anticipate expanding AERCO’s worldwide presence.”
Watts Water Technologies, through its subsidiaries, is a leader in the manufacture of products to control the efficiency, safety, and quality of water in residential, commercial, and institutional applications. For more information, visit www.wattswater.com.
Publication date: 11/17/2014