Acquisition of Fasco plant is finalized
On Sept. 4, Regal Beloit announced that it has completed the acquisition of Tecumseh's Fasco operations, including the Cassville plant, for $220 million.
In addition to completing the purchase of Fasco, Regal Beloit announced that it has acquired Jakel Incorporated, a motor and blower manufacturer that maintains an office in Aurora.
"These businesses are a synergistic and natural fit with Regal Beloit's current product offerings," said Henry W. Knueppel, Regal Beloit chairman and chief executive office. "Specifically, these acquisitions will allow us to expand our offering of energy efficient systems solutions to our customers, in addition to expanding our global manufacturing and commercial footprints, and furthering our ability to bring innovative products to our customers."
According to a press release, Fasco and Jakel Inc., will be combined and operate as a single unit as part of Regal Beloit's electrical segment. Regal Beloit expects the combined businesses to add around $115 million to sales this year. The company also anticipates that the acquired businesses will add around $355 million in sales in 2008.
Regal Beloit has acquired the Fasco businesses that manufacture and market motors and blower systems for air moving applications, including fuel systems, water heaters, heating, ventilating and air conditioning systems. The company has also acquired the Fasco name.
Tecumseh's automotive and speciality division was not part of the transaction. That division will conduct business as Von Weise USA, Inc.
"The completion of this sale transaction is an important element of our ongoing initiatives to improve our liquidity and strengthen our balance sheet, and enhances our ability to focus on our core businesses and improve our financial performance," said Ed Buker, Tecumseh chief executive officer.
The acquisitions include the Fasco facilities in Eldon and Cassville, Piedras Negras, Mexico, Bangkok, Thailand, and Melbourne, Australia, and Jakel's facility in Piedras Negras, Mexico.
Regal Beloit, headquartered in Beloit, Wisc., is a leading manufacturer of mechanical and electrical motion control and power generation products. The company, which serves markets throughout the world, has manufacturing, sales and service facilities throughout the United States, Canada, Mexico, Europe and Asia.
On July 19, the Cassville City Council voted to transfer the lease for the industrial building on Sale Barn Road from Fasco Industries, Inc., to RBC Horizon, Inc., a new corporation created by Regal Beloit in conjunction with the Fasco sales agreement.
According to the lease, which will expire on Sept. 30, 2009, RBC Horizon, Inc., will be required to pay the city $9,000 in rent per year for the remainder of the lease. Tecumseh paid the rent through September of this year.