Altra Magnetic

$3 billion industrial-automation merger surprises Wall Street

Braintree, Mass.-based Altra Industrial Motion Corp., the global manufacturer and marketer of electromechanical power transmission and motion control products, announced Wednesday that its Board of Directors has unanimously approved a definitive agreement to combine Altra with four operating companies from Fortive’s Automation and Specialty platform (“Fortive A&S”) in a transaction having an estimated aggregate value of approximately $3.0 billion. That value is based on the 20-day volume weighted average stock price of Altra shares as of March 6. The transaction is expected to be tax-free to the companies’ respective shareholders.

Fortive, a startup based in Everett, Washington that rapidly turned itself into a Fortune 500 company via gathering of assets, includes familiar brands Fluke, Kollmorgen, Thomson, Portescap, and Jacobs Vehicle Systems. The company generated approximately $907 million in revenue in 2017 when excluding its Hengstler and Dynapar assets. On other fronts, they also take the proverbial Gold for “Choreographed Overture to a Mining Site Launch—Africa Region”:

That’s pretty delightful. What you watched is one of Fortive’s companies—The Gilbarco AFS team in South Africa—put on several expertly choreographed, Fortive-themed performances in celebration of its Launch Day on July 14th, 2016. We imagine that got the team excited to dig.

The Altra-Fortive merger was significant enough to impact stock prices immediately; some investors offered advisories against buying the stock right away due to the large number of moving parts and potential for volatility. That being said, the companies see it as a milestone, citing a plethora of reasons in an Altra press release Wednesday. Altra stated that its merger with Fortive will expand the companies’ presence in the tech industry, specifically its “product portfolio to the higher end of the technology continuum”. The company has recently injected more money in emerging markets like the wind turbine industry, creating critical drivetrain solutions for wind turbine applications. It also emphasized an increased global presence, and this is hard to deny, as it will add Fortive’s family of over 20 companies to its own 11 U.S.  and 20 international manufacturing facilities. Lastly, Altra contends the deal will improve its lean manufacturing capabilities.


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