Rockwell Automation Inc. has reached agreement to sell its Dodge mechanical and Reliance Electric motors and motor repair services businesses to Baldor Electric Co. for $1.8 billion. The transaction is expected to be completed in the first quarter of 2007 and is subject to customary closing conditions and necessary regulatory approvals.
Baldor, a Fort Smith, Ark.-based manufacturer of industrial electric motors, drives and generators, has agreed to pay $1.75 billion in cash and about 1.6 million shares of Baldor common stock for Reliance Electric in order to expand into transmission products and larger motors, the company said. The purchase also gives Baldor a manufacturing base in China.
Last June, Milwaukee-based Rockwell Automation announced its intention to explore the sale of the Dodge Reliance Electric motors and businesses, which operates as Rockwell's Power Systems segment, to focus its efforts on faster-growing electronic and software products.
Baldor reportedly might sell the electric motor repair business it's buying from Rockwell, executives said on a conference call. Rockwell CEO Keith Nosbusch says the sale expands his company's effort to move toward specialized industrial products such as factory-control software and away from commodity equipment.
A webcast and slide presentation describing details of the transaction are available on Baldor’s website at www.baldor.com/investors/presentations.asp in the investor relations’ news and events section.
