Posted January 9, 2018

Applied Industrial Technologies to acquire FCX Performance

Applied Industrial Technologies has reached a definitive agreement to acquire FCX Performance Inc.

Applied will pay approximately $768 million for the distributor of specialty process flow control products and services based in Columbus, Ohio. The transaction is expected to close within 30 days and will be financed with a new credit facility comprised of a $780 million Term Loan A and $250 million revolver, effective with the transaction closing.

FCX is a distributor of highly engineered valves, instruments, pumps, and lifecycle services to MRO and OEM customers across diverse industrial and process end markets. FCX operates 68 locations with more than 1,000 team members.

The acquisition is anticipated to contribute approximately $550 million in sales and $68 million in EBITDA in the first 12 months of Applied ownership, prior to recognition of one-time transaction expenses and the impact of purchase accounting adjustments. Additionally, the transaction is expected to be accretive in fiscal year 2019 following recognition of related one-time transaction costs in fiscal year 2018.

“We are very pleased to announce the pending acquisition of FCX, which further enhances our position as a differentiated industrial distributor,” said Neil A. Schrimsher, president and chief executive officer for Applied. “FCX brings to Applied market leading, value-added specialty flow control expertise with premier brands, high-touch technical service, an extensive footprint, and strong customer relationships. This compelling adjacency move is an excellent fit, especially when considering served industries, customer opportunities, engineering capabilities and value-added services. Our combined resources will make us a leading technical solutions provider with significant opportunities for growth.”

Tom Cox, CEO of FCX, added, “We are extremely excited about the strategic prospects and overall fit with Applied. The shared business philosophies and values, as well as the complementary products, custom application expertise, and complete one-stop solutions offering will provide enhanced value for our customers and excellent growth potential for our suppliers and team members.”