Summary
Rockwell Automation, Inc. (ROK) has reported the completion of a significant divestiture. On January 31, 2007, the company finalized the sale of its Dodge mechanical and Reliance Electric motors and motor repair services businesses to Baldor Electric Company for a total of $1.8 billion. This transaction comprises $1.75 billion in cash and approximately $50 million worth of Baldor common stock, effectively exiting the principal businesses of its former Power Systems operating segment. The filing also includes unaudited pro forma financial information as of and for periods ending December 31, 2006, and fiscal years ending September 30, 2006, 2005, and 2004. This pro forma data reflects the impact of the divestiture, allowing investors to assess the company's financial position and performance as if the sale had occurred earlier. The primary effect on the balance sheet is a substantial increase in cash and a reduction in assets previously classified as 'available for sale'.
Key Highlights
- 1Completed divestiture of Dodge mechanical and Reliance Electric businesses to Baldor Electric Company on January 31, 2007.
- 2Total transaction value of $1.8 billion, consisting of $1.75 billion in cash and $0.05 billion in Baldor common stock.
- 3The divested businesses represented the core of Rockwell Automation's former Power Systems operating segment.
- 4The company has provided unaudited pro forma financial statements reflecting the divestiture's impact.
- 5Pro forma balance sheet as of December 31, 2006, shows a significant increase in cash due to the transaction.
- 6Pro forma statements of operations adjust historical figures to exclude the divested businesses for periods ending December 31, 2006, and fiscal years 2006, 2005, and 2004.
- 7The company used a portion of the cash proceeds to repay all outstanding commercial paper borrowings.