NORTH ANDOVER, Mass., Apr 01, 2011 (BUSINESS WIRE) --
Watts Water Technologies, Inc. (NYSE: WTS) announced today the signing
of a definitive agreement to acquire Danfoss Socla S.A.S ("Socla"), and
the related water controls business of certain other entities controlled
by Danfoss A/S, in a share and asset purchase transaction. The purchase
agreement also provides Watts with an option to purchase the water
controls business of Danfoss in China, which may be exercised prior to
the closing date. The acquisition of Socla is expected to close by the
end of April 2011. The consummation of the acquisition is subject to
customary closing conditions.
Socla is a leading manufacturer of a wide range of water protection
valves and flow control solutions for the plumbing market and for the
heating, ventilation and air conditioning market. The company is based
in France and its products are distributed worldwide for municipal,
industrial, commercial and residential use.
Socla's annual revenue for 2010, including the water controls business
in China, was approximately $135 million. Under the terms of the
purchase agreement, Watts will pay approximately $165 million in cash to
purchase 100% of the share capital of Socla on a debt/cash free basis,
plus the related water controls business assets. The purchase price is
subject to a net debt and net working capital adjustment. The purchase
price will be increased by approximately $4 million if Watts elects to
purchase the water controls business in China. The foregoing revenue and
purchase price amounts are based on the current exchange rate of the
euro to the U.S. dollar. Watts intends to fund the transaction with cash
on hand and borrowings under its credit facility.
David Coghlan, Chief Executive Officer, commented, "Socla significantly
strengthens our European plumbing and flow control platform and also
adds to our HVAC platform. Socla's major product lines include backflow
preventers, check valves and pressure reducing valves, which are very
similar to our core product lines in North America. This transaction
positions Watts as a strong competitor in Europe in three key areas: (i)
residential and commercial flow control; (ii) HVAC and gas; and (iii)
drains.
Watts Water Technologies, Inc. will hold a live web cast of its
conference call to discuss the acquisition of Socla on Tuesday, April 5,
2011 at 10:00 a.m. Eastern time. The press release and the live web cast
can be accessed by visiting the Investor Relations section of the Watts
Water Technologies, Inc. website at www.wattswater.com.
Following the web cast, an archived version of the call will be
available at the same address until April 5, 2012.
Watts Water Technologies, Inc. is a world leader in the manufacture of
innovative products to control the efficiency, safety, and quality of
water within residential, commercial, and institutional applications.
Its expertise in a wide variety of water technologies enables it to be a
comprehensive supplier to the water industry.
This Press Release may include statements that are not historical facts
and are considered forward-looking within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements reflect Watts Water Technologies' current views about future
results of operations and other forward-looking information. In some
cases you can identify these statements by forward-looking words such as
"anticipate," "believe," "could," "estimate," "expect," "intend," "may,"
"should," and "would" or similar words. You should not rely on
forward-looking statements because Watts' actual results may differ
materially from those indicated by these forward-looking statements as a
result of a number of important factors. These factors include, but are
not limited to, the following: the current economic and financial
condition, which can affect levels of housing starts and remodeling,
affecting the markets where the Company's products are sold,
manufactured, or marketed; shortages in and pricing of raw materials and
supplies; loss of market share through competition; introduction of
competing products by other companies; pressure on prices from
competitors, suppliers, and/or customers; changes in variable interest
rates on Company borrowings; identification and disclosure of material
weaknesses in our internal control over financial reporting; failure to
expand our markets through acquisitions; failure or delay in developing
new products; lack of acceptance of new products; failure to manufacture
products that meet required performance and safety standards; foreign
exchange rate fluctuations; cyclicality of industries, such as plumbing
and heating wholesalers and home improvement retailers, in which the
Company markets certain of its products; environmental compliance costs;
product liability risks; the results and timing of the Company's
manufacturing restructuring plan; changes in the status of current
litigation, including other risks and uncertainties discussed under the
heading "Item 1A. Risk Factors" in the Watts Water Technologies, Inc.
Annual Report on Form 10-K for the year ended December 31, 2010 filed
with the Securities Exchange Commission and other reports Watts files
from time to time with the Securities and Exchange Commission. Watts
does not intend to, and undertakes no duty to, update the information
contained in this Press Release, except as required by law.
SOURCE: Watts Water Technologies, Inc.
Watts Water Technologies, Inc.
William C. McCartney, 978-688-1811
Fax: 978-688-2976