General industrial company,
), announced that Allegion US Holding Company - its wholly-owned
subsidiary - proposes to privately offer senior notes. However,
Ingersoll Rand will neither be a guarantor nor an obligator to
In Dec 2012, Ingersoll approved a plan to spin off its
commercial and residential security businesses. The company
expects the divestiture to be complete prior to year-end 2013.
Subsequent to the spin-off, the two businesses will be combined
to form a new company.
The move to issue notes will be beneficial to the company's
commercial and residential security businesses as Allegion
intends to use the cash proceeds from the issue to pay a special
cash distribution to the same. The distribution is expected to
take place before the proposed spin-off of the commercial and
residential security businesses.
In June, Ingersoll Rand completed the offering of $1.55
billion notes. The offering consisted of three tranches; viz.,
2.875% Notes worth $350 million due in 2019, 4.25% Notes worth
$700 million due in 2023 and 5.75% Notes worth $500 million due
in 2043. The proceeds from the issue are expected to pay off the
company's 6.00% Senior Notes worth $600 million due in 2013 and
9.5% Senior Notes worth $655 million due in 2014. The remainder
will be used for the proposed spin-off.
This early retirement of the notes will incur a redemption
premium expense for the company to the tune of $46 million and is
expected to negatively impact the company's third-quarter 2013
earnings by roughly 15 cents per share. The Zacks Consensus
Estimate for the said quarter stands at $1.10 per share.
Ingersoll Rand is one of the leading providers of security and
safety, climate control, industrial productivity and
infrastructure products. The company currently carries a Zacks
Rank #2 (Buy). Other stocks that are worth a look in the industry
The Middleby Corporation
). While Gorman-Rupp and Graham Corp. carry a Zacks Rank #1
(Strong Buy), Middleby carries a Zacks Rank #2 (Buy).
GRAHAM CORP (GHM): Free Stock Analysis Report
GORMAN RUPP CO (GRC): Free Stock Analysis
INGERSOLL RAND (IR): Free Stock Analysis
MIDDLEBY CORP (MIDD): Free Stock Analysis
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