Dover Corporation (DOV) stated it has entered into an agreement to sell a couple of its operating companies belonging to the Industrial Products segment to International Equipment Solutions, LLC, an affiliate of KPS Capital Partners, LP.
The operating companies which are earmarked for sale are Rochester, Minnesota based cab equipment enclosures maker, Crenlo, LLC and Cedar Rapids, Iowa based Paladin Brands, North America's largest independent manufacturer of attachment tools. The transaction is expected to close before the end of this month.
The company decided to divest the units as they no longer featured in its long-term growth strategy. During the second-quarter earnings release the company said it was evaluating the potential sale of certain companies within the Material Handling platform of its Industrial Products segment.
The paring of non-core assets will allow Dover to concentrate on as well as cater to key market sectors within Industrial Products. This segment accounted for 26.3% of total revenue in the second quarter.
Besides disposing of assets that are not aligned to its long-term agenda, Dover is also making timely acquisitions to gain market share and improve product offerings. The acquisition of Sound Solutions – the specialized manufacturer of dynamic speakers and receivers for cell phones and other consumer electronics goods – from NXP Semiconductors NV (NXP) will place Dover as the leading provider of acoustic products serving the fast growing cellular handset market.
Dover currently has a Zacks #3 Rank, which translates into a short-term Hold recommendation on the stock. Dover competes with the likes of Cooper Industries plc (CBE), Ingersoll-Rand Plc (IR) Weatherford International Ltd. (WFT).
Dover Corporation is an industrial conglomerate producing a wide range of specialized industrial products and manufacturing equipment. It operates primarily in the U.S. and has subsidiaries and affiliates in Canada, France, Germany, the Netherlands, Sweden, China and the United Kingdom. Dover caters to a diverse clientele primarily spread over the Americas, Europe and Asia.
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