ABB to acquire Baldor Electric Company
30 November 2010
In a bid to become a global leader in industrial motion ABB has announced that it is to acquire Baldor.
The addition of Baldor products will close a gap in ABB’s automation portfolio by adding Baldor’s NEMA motors product line and will position the company as a market leader for industrial motors, including high-efficiency motors. Baldor also brings a growing mechanical power transmission business to the party.
It is expected that this acquisition will also improve ABB’s access to the industrial customer base in North America, opening opportunities for its wider portfolio, including energy efficient drives and complementary motors. This move comes at a time when regulatory changes in the US and other parts of the world is expected to accelerate demand for energy efficient industrial motion products. ABB is also keen to tap into the potential in North America for rail and wind investments, both of which are expected to grow rapidly in coming years.
“Baldor is a great company with an extremely strong brand in the world’s largest industrial market,” said Joe Hogan, ABB’s CEO. “Baldor’s product range and regional scope are highly complementary to ours and give both companies significant opportunities to deliver greater value to our customers.”
John McFarland, Chairman of the Board and CEO of Baldor, said: “Our Board of Directors believes this transaction is in the best interest of our shareholders, our employees and our customers. It demonstrates the value our employees have created and the strength of our brand and products in the global motors industry. We are excited about the opportunity to join ABB’s worldwide family as we have always respected ABB. We are very pleased that ABB will locate its motor and generator business headquarters for North America in Fort Smith and we are confident that the combined global platform will be well positioned to capitalize on meaningful growth opportunities in the future.” John McFarland will stay with the combined business to support a successful integration.
The US market for high-efficiency motors is expected to grow 10 to15% in 2011 on the back of new regulations, effective in December this year. Similar regulations in Canada, Mexico and in the European Union are expected in 2011. “ABB and Baldor will be able to offer our North American and global customers an unparalleled range of high-efficiency industrial products and services to help them meet their new demands,” said Ulrich Spiesshofer, Executive Committee member responsible for ABB’s Discrete Automation and Motion division, into which Baldor’s business will be integrated alongside the existing Motors and Generators business.
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