SPX Advances as Bosch Buys $1.15 Billion Auto-Service Unit
Stock Chart for SPX Corp (SPW)
The deal should close in the first half and give Charlotte, North-Carolina-based SPX an after-tax book gain of $450 million, or $8.65 a share, according to a statement today. For Stuttgart, Germany-based Bosch, the SPX Service Solutions unit adds a division that took in about $920 million in sales last year.
The transaction builds on the takeover of Taiwan’s Unipoint Group announced in August, and Bosch said it was the company’s biggest purchase of an auto-repair business. Closely held Bosch has a 10 percent share of the 43 billion-euro ($56 billion) global auto spare-parts and repairs market, Udo Ruegheimer, a spokesman, told journalists on a conference call.
“Acquiring SPX Service Solutions will help make Bosch one of the leading providers of diagnostic solutions,” Robert Hanser, president of Bosch’s automotive aftermarket division, said in a statement. “The acquisition will allow us to considerably expand our market presence in the diagnostics business, particularly in North America.”
SPX climbed 1.6 percent to $67.50 at the close in New York, extending the shares’ gain for 2012 to 12 percent.
SPX Service Solutions manufactures and sells tools, workshop equipment and software for auto repair shops. The division employs 2,700 people in 17 countries, primarily in the U.S., Germany, France and China, who will boost the number of Bosch employees in the business to about 15,000, Ruegheimer said.
“SPX has diagnostic equipment and software and repair solutions, as well as other equipment which complements our portfolio in the air-conditioning service field,” Heiderose Dreiner, a Bosch spokeswoman, said on the call. “They also give us more access to vehicle data and the North American market.”
Bosch, which also produces household appliances and do-it- yourself and gardening goods, has “adequate funds” for the acquisition, Ruegheimer said.
“Bosch is dedicated to the automotive service sector and has strong relationships” with vehicle manufacturers, David Kowalski, SPX segment president, said in a separate statement. “Service Solutions is a very good strategic fit with Bosch.”
SPX’s other products include power-plant cooling systems and pumps used by oil producers.
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