Charlotte manufacturer to be sold for nearly $4B. What it means for local operations
Charlotte-based manufacturer SPX Flow is being acquired by a private equity firm in a deal valued at $3.8 billion, the companies announced Monday morning.
An affiliate of Lone Star Funds is the purchaser, and intends to take SPX Flow private. The all-cash purchase price of $86.50 per share represents a nearly 40% increase over SPX Flow’s closing price on July 16, the last day before a Wall Street Journal story said SPX Flow had received an unsolicited purchase offer.
SPX Flow manufactures equipment like pumps, valves and filtration systems for such customers as Unilever, Abbot, Basf and Hyundai in the nutrition, health and industrial markets.
The company’s headquarters will remain in Charlotte, and CEO Marc Michael and his leadership team also will remain, SPX Flow spokesman Peter Smolowitz said.
SPX Flow has over 130 employees in Charlotte, and that staffing level won’t change, Smolowitz said. The company has over 5,000 workers worldwide.
In 2015, SPX Flow spun off from its former parent company, SPX.
“We are pleased to have reached this agreement with Lone Star, which is the result of a comprehensive review of alternatives, including a robust sale process, conducted by our board in consultation with independent advisors,” Robert Hull, Jr., SPX Flow board chair said in a news release announcing the sale.
Donald Quintin, president of Lone Star Opportunity Funds, called the acquisition “consistent with Lone Star’s strategy to invest in businesses with substantial runway for growth.”
About the deal
The acquisition is expected to close in the first half of next year.
When that happens, SPX Flow will become a privately held company and it shares will no longer trade on The New York Stock Exchange, the companies said.
The deal is an all-cash transaction, and includes the assumption of debt.
As a condition to the transaction, SPX Flow has agreed to suspend payment of its quarterly dividend, effective immediately.
About SPX Flow
Headquartered in Ballantyne, SPX FLow has transformed from an automotive business making piston rings to a multinational industrial portfolio conglomerate.
SPX Flow formed five years ago when parent company SPX Corp. spun it off to be a separate company, manufacturing equipment like pumps, valves and filtration systems for such customers as Unilever, Abbot, Basf and Hyundai. There are about 15 manufacturing sites in Asia, Europe and throughout the U.S., although none are in North Carolina.
The company has been focused on growth in nutrition and health, and industrial markets, with customers in food and beverage, pharmaceuticals, and water, chemicals and mining, Michael previously told the Observer.
SPX Flow has made several acquisitions in the past couple years before being targeted by another business for acquisition.
Last year, SPX Flow purchased North Dakota-based Posi Lock, maker of hydraulic and mechanical pullers, for $10 million.
In January, SPX Flow bought UTG Mixing Group for $41 million. And in May, SPX Flow purchased Philadelphia Mixing Solutions from Thunder Basin Corp. for $65 million.
About Lone Star Funds
Founded by John Grayken nearly 30 years ago, Lone Star Funds is a global private equity firm advising in real estate, equity, credit and other financial assets. The Texas-based company has organized 21 private equity funds with aggregate capital totaling about $85 billion, according to the company.
Lone Star Funds invests on behalf of its limited partners as well as foundations and endowments that support medical research, higher education and other philanthropic causes.
Lone Star Funds has 13 offices with three in the U.S. in Dallas, Texas, New York and Miami, as well as locations in Canada, Asia and Europe, according to the company website.
This story was originally published December 13, 2021 at 8:15 AM.
