Private equity firm to acquire SPX Flow in US$3.8bn deal

SPX Flow Inc has entered into an agreement to be acquired by an affiliate of private equity firm Lone Star Funds in an all-cash transaction valued at US$3.8 billion.

Image: Péter Mács/Adobe Stock.

The purchase price of US$86.50 per share in cash represents a premium of nearly 40% over SPX Flow’s closing stock price on 16 July 2021, the last trading day prior to the publication of an article in The Wall Street Journal stating that the company had received an unsolicited purchase offer.

When the transaction is completed, SPX Flow will become a privately held company and its shares will no longer trade on The New York Stock Exchange.

Headquartered in Charlotte, North Carolina, USA, SPX Flow had 2020 revenues of approximately US$1.4 billion, with operations in more than 30 countries and sales in over 140 countries. SPX Flow pump brands include APV, Bolting Systems, Bran+Luebbe, Gerstenberg Schroeder, Hytec, Johnson Pump, Johnson Pump Marine, Pneumatic Products, Power Team and Waukesha Cherry-Burrell.

“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,” said Robert F Hull Jr, chairman of the SPX Flow board of directors. “As part of the process, SPX Flow held discussions with multiple strategic and financial parties and evaluated the transaction against the company’s standalone prospects, performance and outlook. We believe this transaction is the right path forward and achieves our goal of maximising value for SPX Flow shareholders.”

“SPX Flow has transformed its business and made important progress executing against our strategic plans, and we believe this transaction with Lone Star is an exciting culmination of those efforts for our shareholders,” said Marc Michael, SPX Flow president and CEO.

“We are excited about the opportunity to partner with SPX Flow,” said Donald Quintin, president, Lone Star Opportunity Funds. “This acquisition is consistent with Lone Star’s strategy to invest in businesses with substantial runway for growth.”