AZZ Buys Aquilex for $250 Million

On Monday, electrical equipment manufacturer AZZ  (NYSE: AZZ  ) announced that it has agreed to purchase energy services company Aquilex Specialty Repair and Overhaul for $250 million.

Aquilex, a holding of private equity firm Centerbridge Partners, specializes in the maintenance and repair of both nuclear and fossil fuel power plants and refineries and does maintenance and "life-extension" work on other industrial plants. AZZ is adding it to expand its capability in electrical and industrial products.

From a financial perspective, AZZ notes that it expects Aquilex to produce about $225 million to $250 million in annual revenue. As such, the roughly one times annual sales price it is paying for the company offers a significant discount to the 1.9 times sales valuation AZZ's own shares command. Accordingly, investors are applauding the purchase, bidding AZZ shares up 4.1% in Monday trading, to close at $43.43.

AZZ added in a press release that it expects the acquisition to be accretive to earnings in the amount of $0.25 to $0.30 per share in the first year after closing (expected to occur sometime in the next 30 days). Aquilex is expected to contribute as much as $0.50 to $0.60 to per-share profits in the second year of ownership.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2277286, ~/Articles/ArticleHandler.aspx, 10/22/2014 8:39:04 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement