Dover Corporation DOV has completed the previously announced acquisition of Tokheim`s dispenser and system businesses. In Sep 2015, Dover had made a binding offer of EUR 425 million (approximately $465 million) to buy these businesses, which will become a part of its OPW unit.
Headquartered in Paris, Tokheim is a leading manufacturer of fuel dispensers and one of the world’s largest providers of fuel retailing solutions with a strong presence in the European, African, South American and Asian markets. Its products are well known in the retail fueling industry.
The acquisition of Tokheim`s dispenser and systems businesses is in line with Dover’s expansion strategy and will perfectly match OPW’s products and systems. OPW is a business unit within Dover`s Fluids segment providing fluid handling solutions for the safe and efficient handling and distribution of fuels and critical fluids.
Through this acquisition, Dover will establish OPW as a leading retail fueling systems provider, featuring a full Station-in-a-Box offering with unmatched products. Moreover, the acquired technology will entrench OPW’s already strong position in retail fueling equipment. The buyout will also help in Dover’s geographic expansion.
Dover expects the acquisition to be accretive to earnings per share by about 7 cents in 2016 and 13 cents in 2017. Excluding normal transaction-related costs and purchase accounting amortization, the acquisition will be accretive to earnings per share by approximately 15 cents in 2016 and around 21 cents in 2017.
Dover has a long-standing history of making successful acquisitions in diverse end markets. In 2014, the company acquired MS Printing Solutions S.r.l., The WellMark Company and Liquip International. Also, in 2014, Dover took over Accelerated Companies to bolster its position in the U.S. shale market. During 2015, the company acquired a product line in the Refrigeration & Food Equipment segment for $6.5 million. Additional acquisitions will continue to drive growth.
Moreover, Dover expects to benefit from restructuring activities in 2016. Share repurchase will also be a significant growth driver this year. However, difficult market conditions, especially in the oil & gas space, will remain as headwinds for the company in the near term.
Illinois-based Dover is an industrial conglomerate producing a wide range of specialized industrial products and manufacturing equipment. It operates through four major operating segments: Energy, Engineered Systems, Fluids and Refrigeration & Food Equipment.
Dover currently carries a Zacks Rank #4 (Sell). DXP Enterprises, Inc. DXPE, Gorman-Rupp Co. GRC and Graham Corporation GHM are some better-ranked stocks in the space. While DXP Enterprises sports a Zacks Rank #1 (Strong Buy), Gorman-Rupp and Graham Corporation carry a Zacks Rank #2 (Buy).
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