Parker Hannifin (PH), which makes motion-control technology, has agreed to acquire filtration-products manufacturer Clarcor (CLC) for about $4.3 billion, including debt assumption.
The deal for $83 a share in cash, represents a premium of 18% to Clarcor’s closing price on Wednesday, according to a written statement Thursday by Cleveland-based Parker.
Shares of Clarcor leapt by roughly 17% to close at 82.58 on the stock market today. Parker Hannifin jumped more than 3% to 143.47. Both hit record highs.
Clarcor makes filters for automotive and heavy industrial applications and reported $1.5 billion in sales for the fiscal year through November 2015. The Franklin, Tenn.-based company has about 6,000 employees worldwide. The deal adds an array of industrial air and liquid filtration technologies to Parker’s filtration portfolio, according to the statement.
The combination “offers a great opportunity to combine our strength in international markets and original-equipment manufacturers with Clarcor’s strong U.S. presence and high percentage of recurring sales in the aftermarket,” Parker Chief Executive Tom Williams said in the statement.
Parker expects to realize annual cost synergies of about $140 million three years after closing, in part through the consolidation of the companies’ supply chains. Parker posted sales of $11.4 billion for the fiscal year through June and had 49,000 employees.
The transaction has been approved by the boards of both companies and is expected to be completed by the end of September, subject to customary conditions and approval by Clarcor’s shareholders.
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