Valve Magazine - Spring 2012

INDUSTRY
ACQUISITIONS & ALLIANCES
CAPSULES
Pentair and Tyco Flow Control
Business to Merge

Pentair, Inc. and Tyco International Ltd. have agreed to combine Tyco's Flow Control business with Pentair in a tax-free, all-stock merger. The transaction values Tyco Flow at approximately $4.9 billion, including assumed net debt and minority interest.

Upon completion of the transaction, which has been unanimously approved by the boards of both companies, Tyco shareholders will own approximately 52.5% of the combined company, and Pentair shareholders will own approximately 47.5%.

The combination will bring together complementary leaders in water and fluid solutions, valves and controls, and equipment protection products to create a premier industrial growth company. The merged company is expected to have pro forma 2012 revenues of $7.7 billion.

The new company will be named Pentair and will be led by Randall J. Hogan, Pentair's current chairman and chief executive officer.

Weir Group Acquires Novatech LLC The Weir Group PLC has agreed to acquire Novatech LLC, a U.S. manufacturer of well service pump valves and valve seats for upstream oil and gas applications, for $176 million in cash. Based in Dallas, Novatech, a family-owned business, produces a wide variety of proprietary valves and valve seats for high-pressure applications such as frac, cement and mud pumps used in unconventional upstream oil and gas operations. The business is well known to Weir, being a long-standing local supplier to Weir SPM.

Curtiss-Wright Flow Control and Chalmers &
Kubeck Form Nuclear Services Alliance

Enertech, a business unit of Curtiss-Wright Flow Control, and Chalmers & Kubeck, Inc. have signed an exclusive agreement to collaborate in providing integrated services and life-cycle management of specialized, critical components to the nuclear power industry.

Under the terms of the agreement, Enertech will focus its efforts on sales and marketing for Chalmers & Kubeck’s service, repair and machining capabilities. In addition, the alliance will leverage Enertech’s nuclear quality assurance program for components in safety-related applications.

MARKET FOCUS: Industrial Valve Forecast

The industrial valve industry will experience the third year in a row of growth, rising to about $4 billion in 2012, according to Valve Manufacturers Association’s annual market forecast, which was released earlier this year. That rise of

2.2% from 2011 levels means the industry has come back up to the 10-year peak of

2008, when the industry was also at $4 billion.

Although industry growth occurred at higher percentage rates at the beginning of this decade, the fact it has continued rising steadily during a time when other industries were suffering “shows how strong the valve industry is,” according to VMA Chairman Bruce Broxterman, president of Richards Industries. The industry

Iron & Steel

2%

Pulp & Paper 7%

up speed: growth from 2010 to 2011 was at a rate of about 1.5%.

Over the last few years, much of the growth can be attrib-
uted to exports of valves, which rose to $760 million in
2011 and will grow to $790 million by 2012. But also
contributing in 2012 will
be an expected rise in
domestic shipments, which
have been flat the last few
years.

The annual forecast also reveals the distribution of end-user markets in 2012, with water and wastewater still retaining the largest share (18%) of the 15 markets VMA tracks, followed by chemical (17%), petroleum production and refining (about 12% for each area) and power generation (11%).