Regal Rexnord Corporation Announces It Will Explore Strategic Alternatives For Businesses In The Industrial Systems Segment
Regal Rexnord Corporation (NYSE: RRX) announced plans to explore strategic alternatives for its Motors and Generators businesses within the Industrial Systems segment. CEO Louis Pinkham highlighted significant improvements in adjusted EBITDA margins, up 700 basis points, and strong revenue growth. The strategic review may lead to a divestiture of these assets, focusing on finding a better owner. Guggenheim Securities is advising on this review. Regal Rexnord specializes in industrial powertrain solutions and has a global manufacturing and service footprint.
- Adjusted EBITDA margins improved by approximately 700 basis points.
- Motors and Generators is experiencing revenue and order growth.
- Potential divestiture may indicate uncertainty regarding the future of the Motors and Generators segment.
BELOIT, Wis., Nov. 30, 2022 /PRNewswire/ -- Regal Rexnord Corporation (NYSE: RRX) today announced that it intends to explore strategic alternatives for the global motors and generators businesses ("Motors and Generators") that represent a majority of the sales within its Industrial Systems reporting segment. The strategic review may or may not lead to a decision to divest these businesses.
Regarding the announcement, CEO Louis Pinkham commented, "I am proud of what our Industrial team has accomplished in the last few years. Through their disciplined deployment of 80/20 and rigorous use of lean tools, adjusted EBITDA margins for the business have improved by roughly 700 basis points. The business is also growing nicely, aided by share gains, which is evident in recent revenue and orders performance. Now, after carefully considering for some time how best to help the Industrial Systems business maximize its potential, we decided to explore whether there might be a better owner of these assets, in particular our global motors and generators businesses. It is in this spirit that we're launching the strategic review announced today. We plan to review our findings in a disciplined and rational manner, and after sharing conclusions with our associates, make them known to other relevant stakeholders."
Motors and Generators is a global leader in the design and manufacture of integral (~>5 HP) motors and generators for a diverse range of industrial applications, with a 100+ year legacy of engineering excellence and product innovation. Motors and Generators' products serve a diverse range of attractive and growing end markets and the businesses comprise a global manufacturing, distribution and service footprint.
Guggenheim Securities is serving as financial advisor associated with the strategic review.
About Regal Rexnord
Regal Rexnord Corporation is a global leader in the engineering and manufacturing of industrial powertrain solutions, power transmission components, electric motors and electronic controls, air moving products and specialty electrical components and systems, serving customers around the world. Through longstanding technology leadership and an intentional focus on producing more energy-efficient products and systems, Regal Rexnord helps create a better tomorrow – for its customers and for the planet.
Regal Rexnord is comprised of four segments: Motion Control Solutions, Climate Solutions, Commercial Systems and Industrial Systems. Regal Rexnord is headquartered in Beloit, Wisconsin and has manufacturing, sales and service facilities worldwide. For more information, visit RegalRexnord.com.
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SOURCE Regal Rexnord Corporation
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