Franklin Electric Acquires U.S. Groundwater Distribution Company

Rhea-AI Summary

Franklin Electric Co. (NASDAQ: FELE) announced the acquisition of Gicon Pumps & Equipment Inc. for $27.9 million on December 31, 2020. Gicon, based in Lubbock, Texas, is recognized for its quality service in the groundwater distribution sector, with annual sales of approximately $68 million. This acquisition enhances Franklin Electric's geographic presence in Texas and strengthens its commitment to groundwater markets, positioning it as a leading distributor of water systems solutions in the U.S.

Positive

• Acquisition of Gicon Pumps & Equipment expands Franklin Electric's market presence in Texas.
• Gicon has a strong reputation with over 40 years of experience in the groundwater sector.
• The acquisition is expected to enhance Franklin Electric's distribution capabilities and product offerings in water systems.

Negative

• None.

FORT WAYNE, Ind., Jan. 04, 2021 (GLOBE NEWSWIRE) -- Franklin Electric Co., Inc. (NASDAQ: FELE) announced today that on December 31, 2020 it acquired Gicon Pumps & Equipment Inc. of Lubbock, Texas for $27.9 million in a cash transaction. Gicon is a professional groundwater distributor operating seven locations in the state of Texas. Gicon has approximately $68 million of consolidated annual sales.

DeLancey Davis, President of Headwater Companies, the wholly owned Distribution Segment of Franklin Electric, commented:

“We are pleased to add Gicon to the Headwater family. The team at Gicon has served the pump industry and related water resource markets for over 40 years and has an outstanding reputation within the industry for quality service and technical depth. The acquisition of Gicon adds to Headwater’s commitment to the critical groundwater markets, provides geographic expansion in the Texas market and further fulfills our objective of being the leading source for water systems solutions distribution in the U.S.”

Headwater Companies, LLC is a collection of leading groundwater distributors. Headwater is a focused groundwater distribution organization that delivers quality products and leading brands to the industry, providing contractors with the availability and service they demand to meet their application challenges.

Franklin Electric is a global leader in the production and marketing of systems and components for the movement of water and fuel. Recognized as a technical leader in its products and services, Franklin Electric serves customers around the world in residential, commercial, agricultural, industrial, municipal, and fueling applications.

"Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein, including those relating to market conditions or the Company’s financial results, costs, expenses or expense reductions, profit margins, inventory levels, foreign currency translation rates, liquidity expectations, business goals and sales growth, involve risks and uncertainties, including but not limited to, risks and uncertainties with respect to general economic and currency conditions, various conditions specific to the Company’s business and industry, weather conditions, new housing starts, market demand, competitive factors, changes in distribution channels, supply constraints, effect of price increases,  raw material costs, technology factors, integration of acquisitions, litigation, government and regulatory actions, the Company’s accounting policies, future trends, epidemics and pandemics, and other risks which are detailed in the Company’s Securities and Exchange Commission filings, included in Item 1A of Part I of the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2019, Exhibit 99.1 attached thereto and in Item 1A of Part II of the Company’s Quarterly Reports on Form 10-Q. These risks and uncertainties may cause actual results to differ materially from those indicated by the forward-looking statements. All forward-looking statements made herein are based on information currently available, and the Company assumes no obligation to update any forward-looking statements.

Contact:

John J. Haines Franklin Electric Co., Inc. 260-824-2900

FAQ

What is the purpose of Franklin Electric's acquisition of Gicon Pumps & Equipment Inc.?

The acquisition aims to enhance Franklin Electric's market presence in Texas and strengthen its commitment to groundwater solutions.

How much did Franklin Electric pay for the acquisition of Gicon?

Franklin Electric acquired Gicon Pumps & Equipment Inc. for $27.9 million.

What are Gicon's annual sales figures?

Gicon Pumps & Equipment Inc. has approximately $68 million in consolidated annual sales.

When did Franklin Electric acquire Gicon Pumps & Equipment Inc.?

The acquisition was completed on December 31, 2020.

What impact will the acquisition have on Franklin Electric's business?

The acquisition is expected to enhance Franklin Electric's capabilities in the groundwater market and expand its geographic reach.