Shares of Maryland-based, Colfax Corporation ( CFX ) spiralled up to a new 52-week high of $57.66 a day after the manufacturing and engineering company announced it had signed an agreement to acquire CKD Kompresory a.s. from CKD Group.
CKD Kompresory, based in Prague, Czech Republic, is a leading supplier of multi-stage centrifugal compressors to the oil & gas, petrochemical, power and steel industries. The assets have been valued at $57 million, including assumption of debts. Colfax anticipates completion of the transaction in the fourth quarter 2013.
The assets once acquired will be integrated with Colfax's Howden business and renamed as Howden CKD Compressors s.r.o. Addition of CKD Kompresory will enable further strengthening of Howden's compressor business and open new gates for Colfax to penetrate deep into this end market as well as explore new growth opportunities. CKD Kompresory in 2012 generated roughly $40 million in revenue.
Colfax's Howden was founded in 1854 and currently provides precision air and gas handling equipment for challenging applications. Its products are supplied to various industries including power generation, oil and gas, petrochemical, mining and steel.
Prior to this acquisition announcement, Colfax in Sep 2013 signed an agreement to acquire the Global Infrastructure and Industry (GII) business of Flakt Woods Group for €193 million, assuming debt. The completion is subject to closing conditions. Acquisition of GII will strengthen the company's Howden business through its broad product portfolio and large customer base.
Colfax currently has a market capitalization of $5.9 billion and holds a Zacks Rank #3 (Hold). Other companies to look out for are Gorman-Rupp Co. ( GRC ), DXP Enterprises, Inc. ( DXPE ), and Dover Corporation ( DOV ), each carrying a Zacks Rank #2 (Buy).
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