Milwaukee /Business Wire/ – Actuant Corporation (NYSE:ATU) announced today that its Board of Directors has authorized a plan to commence a divestiture process for its Electrical segment. Actuant has retained Robert W. Baird & Company to advise on the process and plans to reclassify the segment to discontinued operations in the third quarter of fiscal 2013.
“The sale of Electrical allows Actuant to streamline our strategy and refocus on the remaining businesses in a way that better positions the Company to take advantage of our core competencies, current business model and global growth trends,” said Robert C. Arzbaecher, Chairman and Chief Executive Officer. “We’ve outlined four areas of emphasis for growth, through both organic and acquisition strategies, which include energy, infrastructure, farm productivity and natural resources & sustainability. Actuant’s three remaining segments are well positioned to build on these secular growth trends, further expand into emerging markets, and deliver superior long-term returns.”
“The Electrical segment has a variety of premium brands and is a valuable asset.” Arzbaecher continued. “We believe the sale of the segment would provide a buyer the opportunity to fully leverage the market leading positions and depth and breadth of the segment’s diverse electrical products and technologies. We will continue to operate the business, including executing its existing plans to grow revenues and profitability, during the divestiture process.”
Actuant intends to redeploy the proceeds from the sale to fund acquisitions and to return capital to shareholders in the form of common stock share repurchases. The Company expects to complete the sale during fiscal 2014.
In conjunction with the reclassification of the Electrical segment to discontinued operations; Actuant announced it expects to record a non-cash, after-tax charge of approximately $150 million from the write-down of the net assets held for sale to their net realizable value in the third quarter. As a result of this charge and the reclassification of Electrical segment results out of continuing operations, actual reported results for the third quarter will not be comparable to the sales and diluted earnings per share (EPS) guidance provided in Actuant’s March 20, 2013 second quarter earnings release. On a comparable basis, the company affirmed its prior third quarter guidance, which included sales of $410-420 million and EPS of $0.63-0.68.
Historical operating results, adjusted to reclassify the Electrical segment from continuing operations, are included in the attachment to this press release. A more comprehensive review of third quarter fiscal 2013 results will be discussed in the Company’s third quarter earnings release and conference call scheduled for June 19, 2013.
The Electrical segment primarily serves the retail do-it-yourself, marine, industrial OEM and wholesale electrical markets with a variety of products under the Gardner Bender, Marinco, Mastervolt, Acme and Turner Electric brand names. In 2012, it had sales of approximately $325 million. The segment employs approximately 1,000 and operates from six locations across the globe with its headquarters in Menomonee Falls, Wisconsin.
For further information on Actuant and its businesses, visit the Company’s website at www.actuant.com.
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