SWINDON, United Kingdom, May 22, 2018 (GLOBE NEWSWIRE) -- Sensata Technologies (NYSE:ST), an industrial technology company, today announced that it has entered into an agreement with Pacific Industrial Co., Ltd. to sell its valves business for a total enterprise value of approximately $173 million. The proposed transaction is subject to customary legal and regulatory requirements and is expected to close in the third quarter of 2018.
Sensata’s valves business manufactures mechanical valves for pressure applications in tires and fluid control, and assembles tire hardware aftermarket products with manufacturing locations in the United States and Europe. The valves business was acquired as part of Sensata’s acquisition of the Schrader group of companies in 2014. For the full year 2017, the business generated approximately $117 million in revenue and $20 million in adjusted EBIT, which excludes intercompany transactions. Sensata’s Tire Pressure Monitoring Business and the Global TPMS Aftermarket business (Schrader Performance Sensors) are not part of this transaction and will remain with Sensata.
“Sensata provides sensing solutions for mission-critical, complex solutions where we have significant differentiation, leading margins and secular growth,” said Martha Sullivan, President & CEO of Sensata. “The valves business performs well for customers and has significantly improved its operating performance since 2014. However, it does not align to our secular growth strategy and will be better positioned as part of Pacific to further expand its tire valves business. Additionally, by divesting the valves business we can further fund our capital deployment initiatives, particularly as it relates to the repurchase of Sensata shares.”
Pacific is an industrial valves manufacturer based in Ogaki, Japan with manufacturing and sales operations in the U.S., Taiwan, South Korea, Thailand, China and Belgium. The Pacific brand has been established as a leader in quality and technology in overseas markets, particularly in Asia, and this move reinforces Pacific’s strategy to grow its presence in Europe and the Americas.
Update to 2018 Financial Guidance
Sensata expects to offset any divested profits through a combination of share repurchases and stronger operational performance. As a result, Sensata is maintaining its full year 2018 adjusted EPS guidance of $3.57 to $3.73. The Company will provide more detailed updates to its guidance at the next regularly scheduled earnings release and conference call.
About Sensata Technologies
Sensata Technologies is one of the world’s leading suppliers of sensing, electrical protection, control and power management solutions with operations and business centers in 12 countries. Sensata’s products improve safety, efficiency and comfort for millions of people every day in automotive, appliance, aircraft, industrial, military, heavy vehicle, heating, ventilation, and air conditioning, data, telecommunications, recreational vehicle, and marine applications. For more information, please visit Sensata’s website at www.sensata.com.
