- Strategically expands severe service flow control offering
in attractive mining, mineral extraction and process
industries
- Highly complementary product and service offering with large
installed base that meaningfully enhances Flowserve’s aftermarket
opportunity
- Attractive upfront purchase multiple of approximately 7.5x
MOGAS’ 2024E adjusted EBITDA which is expected to reduce further
with synergy realization
- Transaction expected to be adjusted Earnings Per Share (EPS)
accretive in the first full year following close
Flowserve Corporation (“Flowserve”) (NYSE: FLS), a leading
provider of flow control products and services for the global
infrastructure markets, announced today that it has signed a
definitive agreement (the “Agreement”) to acquire MOGAS Industries
(“MOGAS”), a privately held, Houston-based provider of
mission-critical severe service valves and associated aftermarket
services for $290 million with a potential $15 million earnout (the
“Transaction”). The Transaction is expected to close in the fourth
quarter of 2024.
Founded in 1973, MOGAS was established by V. Louis Mogas with
the purchase of a small machine shop. Today, MOGAS is a leading
manufacturer of severe service isolation valves for a variety of
end-markets, including mining, power and process industries through
its state-of-the-art manufacturing facility in Houston. MOGAS has
established sales and service offices in Australia, China, Europe,
Canada, South America, the Middle East and India, countries which
are highly complementary to Flowserve’s served geographies.
MOGAS' differentiated valve products are expected to enhance
Flowserve's installed base, creating meaningful aftermarket
opportunities. Upon completion of the Transaction, MOGAS will be
integrated into Flowserve’s Flow Control Division (FCD) segment,
building upon Flowserve’s comprehensive valve and automation
portfolio with the addition of MOGAS’ strong brand, heritage, and
technical expertise in diverse and attractive end markets.
Flowserve anticipates customers of both companies will
significantly benefit from the newly combined product portfolios in
the growing mining industry.
“MOGAS is highly complementary to Flowserve’s current valve
portfolio and further advances our 3D growth strategy by roughly
doubling our direct mining and mineral extraction exposure and
driving further diversification. The combination creates
technically differentiated scale in severe service flow control
with significant aftermarket contribution,” said Scott Rowe,
Flowserve’s President and Chief Executive Officer. “This
acquisition meets our disciplined financial criteria and positions
us to enhance value for all our shareholders, customers and
associates. We are excited to welcome the MOGAS team to
Flowserve.”
Matt Mogas, President and Chief Executive Officer of MOGAS,
commented, “There is no better cultural and strategic fit for our
family’s 50-year-old business than joining with Flowserve, a
company that shares our unwavering commitment to customers, people,
and products. Our employees, who are at the heart of our success,
will benefit from the alignment of values and opportunities for
growth within a larger organization.”
Transaction Details and
Approvals
The Transaction includes an upfront purchase price of $290
million of cash consideration with an additional earnout of up to
$15 million tied to the achievement of certain minimum levels of
adjusted EBITDA of the MOGAS business for the calendar year ended
December 31, 2024. When adjusted for approximately $15 million of
expected tax benefits, the upfront purchase price represents a
purchase multiple of approximately 7.5x MOGAS’ 2024E adjusted
EBITDA.
The Transaction is expected to be accretive to Flowserve’s
adjusted EPS in the first full year following closing. MOGAS
expects to contribute revenues of approximately $200 million with
adjusted EBITDA margins in the high teens.
The additional scale, footprint consolidation and procurement
opportunities provided by the combination provide clear visibility
to at least $15 million of run-rate cost synergies within two years
after closing of the Transaction. Further, the Transaction is
expected to increase Flowserve’s aftermarket potential and provide
the opportunity for revenue growth synergies as well.
Flowserve expects to fund the upfront cash consideration through
a combination of cash and available debt financing. The Transaction
is subject to the satisfaction of customary closing conditions and
regulatory approvals.
Advisors
Jefferies is serving as financial advisor and Baker McKenzie is
serving as legal advisor to Flowserve. Baird is serving as
financial advisor and Foley & Lardner is serving as legal
advisor to MOGAS.
About Flowserve
Flowserve Corp. is one of the world’s leading providers of fluid
motion and control products and services. Operating in more than 50
countries, Flowserve produces engineered and industrial pumps,
seals and valves as well as a range of related flow management
services. More information about Flowserve can be obtained by
visiting Flowserve’s Web site at www.flowserve.com.
Safe Harbor Statement: This news release includes
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934, which are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995, as
amended. Words or phrases such as, "may," "should," "expects,"
"could," "intends," "plans," "anticipates," "estimates,"
"believes," "forecasts," "predicts" or other similar expressions
are intended to identify forward-looking statements, which include,
without limitation, earnings forecasts, statements with respect to
the rationale of Flowserve or MOGAS for entering into the
Agreement, the expected benefit of the Transaction, the timing of
the various steps to be completed in connection with the
Transaction and other statements that are not material facts.
The forward-looking statements included in this news release are
based on our current expectations, projections, estimates and
assumptions. These statements are only predictions, not guarantees.
Such forward-looking statements are subject to numerous risks and
uncertainties that are difficult to predict. These risks and
uncertainties may cause actual results to differ materially from
what is forecast in such forward-looking statements, and include,
without limitation, the following: (a) the possibility that the
Transaction will not be completed on the terms and conditions, or
on the timing, currently contemplated, and that it may not be
completed at all, due to a failure to obtain or satisfy, in a
timely manner or otherwise, court and regulatory approvals and
other conditions of closing necessary to complete the Transaction
or for other reasons; (b) the possibility of adverse reactions or
changes in business relationships resulting from the announcement
or completion of the Transaction; (c) risks relating to MOGAS’
ability to retain and attract key personnel during the interim
period; (d) the possibility of litigation relating to the
Transaction; (e) credit, market, currency, operational, liquidity
and funding risks generally and relating specifically to the
Transaction, including changes in economic conditions, interest
rates or tax rates; and (f) other risks inherent to Flowserve or
MOGAS’ respective businesses and/or factors beyond their control
which could have a material adverse effect on either of the parties
or their ability to complete the Transaction.
All forward-looking statements included in this news release are
based on information available to us on the date hereof, and we
assume no obligation to update any forward-looking statement.
Non-GAAP Financial Information: Some of the financial
information and data contained in this press release, such as
adjusted EBITDA margins, have not been prepared in accordance with
Generally Accepted Accounting Principles in the United States
("GAAP"). Flowserve’s management believes that the presentation of
these non-GAAP financial measures provides investors with a greater
transparency comparison of operating results across a broad
spectrum of companies, which provides a more complete understanding
of Flowserve’s financial performance, competitive position and
prospects for the future. Management also believes that investors
regularly rely on non-GAAP financial measures, such as adjusted
EBITDA margins, to assess operating performance and that such
measures may highlight trends in Flowserve’s business that may not
otherwise be apparent when relying on financial measures calculated
in accordance with GAAP.
While Flowserve believes these non-GAAP measures are useful in
evaluating Flowserve’s performance, this information should be
considered as supplemental in nature and not as a substitute for or
superior to the related financial information prepared in
accordance with GAAP. Additionally, these non-GAAP financial
measures may differ from similar measures presented by other
companies.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240812725843/en/
Flowserve Contacts:
Investors:
Jay Roueche, Vice President, Investor Relations & Treasurer
(972) 443-6560 Tarek Zeni, Director, Investor Relations (469)
420-4045
Media:
Wes Warnock, Vice President, Marketing, Communications &
Public Affairs (972) 443-6900
Flowserve (NYSE:FLS)
過去 株価チャート
から 1 2025 まで 2 2025
Flowserve (NYSE:FLS)
過去 株価チャート
から 2 2024 まで 2 2025
