Rockwell Automation to Commence Sale Process For Mechanical And Motor Business
MILWAUKEE (June 20, 2006) – Rockwell Automation, Inc. (NYSE: ROK) today announced its plan to sell the company’s Dodge® mechanical and Reliance Electric™ motors and motor repair services businesses. These are leading producers of mechanical power transmission products and industrial motors, and are the principal businesses of the company’s Power Systems reporting segment. Rockwell Automation will retain the Reliance Electric and Reliance® branded drives and related parts and services as an integral part of its global drives and customer service businesses.
The Dodge and Reliance Electric businesses, headquartered in Greenville, South Carolina, contribute substantially all of the revenue generated by Power Systems. For fiscal year 2006, this segment is forecasted to generate about $1 billion in revenue and segment operating margins of around 15%.
Keith D. Nosbusch, Chairman and Chief Executive Officer of Rockwell Automation, said, “Power Systems is a great business with an outstanding management team, strong domain expertise, and leading market positions. It has contributed substantially to Rockwell Automation’s growth and success. In their areas of strength, the Dodge and Reliance Electric businesses are unbeatable. We believe that they will benefit from ownership dedicated to investing and globalizing to sustain their growth as the premier providers of power transmission and conversion solutions.”
Joseph D. Swann, President of Rockwell Automation Power Systems, said, “We are enthusiastic about the road ahead, and remain intensely focused on serving our customers, both directly and with the support of our distribution partners. We are proud of what our team at Power Systems has accomplished, and look forward to the continued growth and evolution of our business.”
This transaction stems from Rockwell Automation’s ongoing efforts to enhance shareowner value. The company does not expect this transaction to change its priorities for cash deployment, but will create an even greater focus on power and integrated control and information solutions to meet customers’ business needs.