Melrose offloads North American company in £2.6bn deal
Birmingham-based Melrose Industries has agreed to sell its Nortek Air Management business in a deal worth £2.62bn, five years after buying its parent company, Nortek Inc, for £2.2bn.
The deal will see Nortek Global HVAC and Air Quality & Home Solutions offloaded to Chicago-based Madison Industries.
Melrose said it will use the funds from the deal to reduce debt while spending £100m on the GKN UK pension. The firm says this will mean the funding deficit will have reduced from approximately £1bn to approximately £200m under its ownership.
The deal is expected to complete in the third quarter of this year.
Simon Peckham, chief executive of Melrose, said: “Our strategy of ‘Buy, Improve, Sell’ remains the same but circumstances evolve. Our businesses are all responding to the demands of climate change, driven by customers and consumers; Air Management’s StatePoint Technology® is a perfect example of this. On our watch, our Air Management executive team has created a business from scratch with exemplary environmental credentials which will make a real difference to energy and water consumption in its market. We can now hand that technology to a high quality buyer with specialist aspirations and skills.
“We are continuing to show that it is possible to make great returns for shareholders, while looking after pensioners and answering the environmental demands of the modern world.”