MRC Global Inc.
) recently announced the acquisition of the Flow Control Products
business from privately-held Dan H. Brown Inc. for an undisclosed
amount. Subject to regulatory approvals, the acquisition is
expected to close in the third quarter of 2013.
Flow Control was established in 1981 and provides its products
and services to energy companies based in the Permian Basin. The
business supplies electro-hydraulic, electric and pneumatic valve
automation packages to production facilities, pipelines and plant
operations in the region. The business had a sales turnover of
$28 million in 2012.
MRC Global, on the other hand, is in the process of scaling up
its existing facility in Odessa to an 110,000 feet Regional
Distribution Centre. The expansion is expected to conclude in
2014. Following its acquisition, Flow Control will resume its
operations as an MRC Valve Automation Center. This new business
will be 25
on the list of MRC's global automation centers.
All the 25 employees working with Flow Control at present will
continue working with the business after the acquisition. This
strategic move by MRC Global reaffirms its commitment to
strengthen its position in the major oil producing regions in the
The facility is strategically located in the Permian Basin,
which is the most active oil producing region in the U.S. The
automation center will cater to the needs of MRC Global customers
in all the 25 service locations of MRC in the Permian Basin and
Subsequent to the acquisition, MRC Global will be in a better
position to serve its customers and strengthen its foothold in
the region. The stock currently carries a Zacks Rank #4 (Sell).
However, there are many other stocks in the machinery industry
that are performing better than MRC.
Mueller Water Products, Inc.
), carrying a Zacks Rank #1 (Strong Buy), and
Valmont Industries, Inc.
Lincoln Electric Holdings Inc.
) carrying a Zacks Rank #2 (Buy) each, look attractive and are
LINCOLN ELECTRC (LECO): Free Stock Analysis
MRC GLOBAL INC (MRC): Free Stock Analysis
MUELLER WATER (MWA): Free Stock Analysis
VALMONT INDS (VMI): Free Stock Analysis
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