Rexnord Corporation (RXN) recently priced its common shares offered for sale to the public at $25.75. The offering, declared along with the fiscal third quarter 2014 results, is expected to close on Feb 5, 2014, subject to customary closing conditions.
The company has offered up to 3 million of common stock for sale to the public. Expected net proceeds of $74.4 million will be utilized for Rexnord’s general corporate purposes.
Besides Rexnord selling its shares, 12 million more shares have been offered for resale to the public by certain affiliates of Apollo Global Management, LLC (APO) and George M. Sherman, the Chairman of the board of directors of Rexnord along with his affiliates. Another 2.25 million shares will be available for underwriters. These proceeds, anticipated to be roughly $297.7 million, will not be received by the company.
After the close of the offering, Rexnord is likely to have approximately 101.0 million outstanding common shares.
A brief snapshot of Rexnord Corporation’s third quarter of fiscal 2014 (ended Dec 28, 2013) results has been provided below.
Earnings per share, adjusted for one-time items, were 34 cents in the quarter, above 19 cents earned in the year-ago quarter and the Zacks Consensus Estimate of 32 cents. Net sales generated were $489.1 million, up 3.7% year over year, primarily on the back of healthy organic sales growth at the company’s business segments.
For fiscal year 2014, Rexnord raised its earnings per share guidance to $1.35–$1.39 from $1.32–$1.38 expected earlier. The revision came on the heels of a solid third quarter performance and the completion of the acquisition of Precision Gear Holdings.
Rexnord Corporation is a well-known mechanical components manufacturer and currently has a $2.6 billion market capitalization. The stock currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Eaton Corp. (ETN) and Franklin Electric Co., Inc. (FELE). All these companies hold a Zacks Rank #2 (Buy).
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