Transportation equipment manufacturer Ingersoll-Rand Co. is purchasing Trane for $10.1 billion, officials from both companies announced Monday.
The transaction, which will give Ingersoll-Rand control of the biggest U.S. commercial air conditioner maker, includes buying the 200 million outstanding common shares of Trane stock for $36.50 each and 0.23 shares of Ingersoll-Rand stock. The company will also assume $150 million in Trane debt.
Trane Chairman and CEO Fred Poses said the agreement was a good deal for the company, which until last month was known as American Standard Cos.
“For our share owners, this agreement represents an attractive price for our shares today and the opportunity to participate in a powerful, global diversified industrial company in the future,” Poses said. “Combining Trane and Ingersoll-Rand’s climate-control operation creates a very strong business.”
Poses will resign as Trane president once the purchase is completed in spring 2008.
Herbert L. Henkel, Ingersoll-Rand’s chairman, president and CEO, said his company expects good performance from its Trane division.
“We believe Trane will deliver strong and profitability going forward,” Henkel said. “Based upon market fundamentals such as rising energy costs and conservation initiatives, we expect solid replacement demand for energy-efficient products and for retrofit and refurbishment of current systems.”
The combined 2008 revenue of the two companies is expected to be $17 billion, he added.
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