Schneider Buys Invensys And Merges With Tac
The acquisition is subject to regulatory approvals. ABS EMEA, owned by Invensys plc, is a leading provider of building automation solutions and services (regulation, monitoring and control of all technical equipment in buildings) in the UK under the Satchwell brand name and has a strong presence accross the rest of Europe and in the Middle East. The company generated revenues of $168 million for the fiscal year ended March 31, 2005, with a restated operating profit of $12.3 million. The market of Automation and Control of Building utilities represents a significant growth potential for Schneider Electric since it is a market worth some $11 billion, it is growing on average by more than 6% a year and it offers substantial synergy with Schneider Electric’s existing positions. Building Automation is one of the growth platforms on which Schneider Electric has been focusing on since it announced to develop new activities, less cyclical and with high growth potential. The TAC acquisition in June 2003, enabled Schneider Electric to become a major player in building automation. The subsequent merger between TAC and Andover Controls, acquired in June 2004, further re-enforced Schneider Electric’s position, notably in the US market, integrated systems and security capabilities. The ABS EMEA business will be integrated with the new entity Tour Andover Controls (TAC). The merger of ABS EMEA and TAC will provide significant synergies: – Generates combined revenues of $800 million in 2005, – Enlarges installed customer base, – Offers growth opportunities in key markets (France, Italy, Gulf countries), – Brings additional capabilities in peripherals (actuators, sensors, valves), – Increases services competencies in building automation, – Expands the current existing distribution channel, – Improves internal efficiency and profitability. Henri Lachmann, Chairman and CEO of Schneider Electric, commented: “This acquisition fits very well with our strategy to continue to develop high growth potential platforms. Invensys Advanced Building Systems in Europe and Middle-East will bring us an expanded installed base and additional offering capabilities, notably in peripherals. The complementary fit between Tour Andover Controls and ABS EMEA is strong in terms of solutions and geographic coverage.” Subject to regulatory approvals, Schneider Electric will pay $150 million in cash to acquire 100% of the ABS EMEA business. The acquired operations will be debt free. Schneider Electric will be working in partnership with the other Invensys ABS businesses to sell their complementary products into EMEA territories.