Pentair Plans To Separate Into Two Public Companies

(RTTNews) - Pentair plc (PNR) announced that its board has unanimously approved a plan to separate into two independent, publicly-traded companies. The proposed transaction will create water company, and electrical company. The water company will retain the Pentair name and ticker symbol. Meanwhile, the electrical company will be named at a later date.

The water company focused on smart, sustainable water and fluid processing applications. It designs, manufactures and delivers innovative solutions to residential, commercial and industrial customers who place a premium on high quality water and fluids. Strategic business groups include Filtration & Process, Flow Technologies and Aquatic & Environmental Systems. The company will retain the Pentair name and ticker symbol. Water generated approximately $2.8 billion in sales in 2016.

The electrical company focused on improving utilization, lowering costs and maximizing customer uptime. Its industrial enclosures, fastening systems and thermal management technologies help protect sensitive equipment, buildings and critical processes and help keep people safe. Strategic business groups include Enclosures, Thermal Management and Electrical & Fastening Solutions. The company will be named at a later date. Electrical generated approximately $2.1 billion in sales in 2016.

The separation is expected to occur through a tax-free spin-off of Electrical by Pentair to its shareholders.

Upon separation, John Stauch, Senior Vice President and Chief Financial Officer of Pentair, will become Water's CEO and Karl Frykman, the current President of Pentair's Water segment, will become Water's COO. Existing Board member David Jones will become Chairman of Water. Beth Wozniak, the current President of Pentair's Electrical segment, will become CEO of Electrical. Randall Hogan will retire as Pentair's Chairman and CEO and will serve as Chairman of Electrical.

Pentair expects to complete the separation in the second quarter of 2018, subject to satisfaction of customary conditions, including obtaining final approval from the Pentair Board of Directors, receipt of tax opinions and rulings and effectiveness of appropriate filings with the U.S. Securities and Exchange Commission.

Upon completion of the spin-off, Electrical will become an independent publicly-traded company and Pentair shareholders will receive shares of Electrical on a pro rata basis. Details of the distribution will be included in the Form 10 registration statement. Water is expected to maintain Pentair's existing incorporation and tax residency and Electrical is anticipated to have a similar incorporation and tax residency.