Dec. 28 (Bloomberg) -- Eaton Corp., the world's second- largest maker of hydraulic equipment, agreed to buy closely held AT Holdings Corp. for $695 million to bolster its aerospace unit.
AT owns Argo-Tech Corp., a maker of airplane parts such as engine fuel pumps and ground fueling systems with $206 million in sales last year and 640 employees, Cleveland-based Eaton said today in a statement.
The purchase will bring Eaton's annual aerospace sales to $1.5 billion as Chief Executive Officer Alexander Cutler seeks to blunt the impact of a slowdown in truck-part sales by expanding offerings for commercial jets. Argo-Tech supplies the main engine fuel pump for some of Boeing Co.'s new 787 Dreamliners.
``By acquiring a company with a presence in the commercial aerospace market, it helps Eaton mitigate weakness in the truck market,'' said Ned Armstrong, a Friedman, Billings, Ramsey & Co. analyst in Arlington, Virginia. He rates the stock ``outperform'' and doesn't own any. ``It fills in holes in their product line.''
Cutler has made acquisitions in the aerospace and electric industries amid an estimated 40 percent drop in demand for truck parts next year. He expects sales and profit to increase in 2007, the first time in the company's history that earnings will improve when truck demand has fallen.
Shares of Eaton rose 16 cents to $75.59 at 12:48 p.m. in New York Stock Exchange composite trading and had gained 12 percent this year before today.
Aerospace Deals
``We see the aerospace market as being very strong, not only in the short term, but for several years looking forward,'' Brad Morton, president of Eaton's Irvine, California-based aerospace unit, said in an interview. ``We don't see anything that will impact our ability to grow.''
Cutler, 55, made his first foray into fuel systems with the acquisition of Cobham Plc's fluid and air division in 2005 and then bought PerkinElmer Inc.'s aerospace unit to add pneumatic systems for commercial aircraft. Argo-Tech moves Eaton into high- pressure engine fuel products, which supply gas to the engine.
The company also provides a stream of repair services revenue. Argo-Tech has more than 100,000 fuel pumps in more than 60 percent of large commercial aircraft in service today, and those aircraft typically get five or six main engine fuel pump overhauls in a 30-year life span, Eaton said.
``This is an aftermarket business, so it's more stable,'' said Eli Lustgarten, a Washington-based analyst at Longbow Research who rates the shares ``buy'' and doesn't own any.
Eaton's aerospace unit currently gets 40 percent of its sales from repair services and spare parts, Morton said.
Complete Set
Argo-Tech, with operations in Cleveland; Costa Mesa and Inglewood, California and Tucson, Arizona, makes systems used in General Electric Co. engines on Boeing's 787 and 747-8 jets, as well as Airbus SAS's A350.
The deal will give Eaton a complete set of products from tank to exhaust systems and allow the company to win more orders from customers including engine manufacturers such as Rolls-Royce Group Plc and airport authorities looking to buy ground-based fuel tanks that connect to jetliners, Morton said.
``We're able to go into an Airbus or Gulfstream type of customer and say, `We'll help you design and develop a whole fuel system from the ground refueling truck and connections to the aircraft to the engine','' Morton said.
The transaction will close in the first quarter. Before then, AT Holdings will be reorganized to exclude its cryogenics and non-aerospace units, which had sales of $22 million in 2006.
Eaton's Business
Eaton's hydraulics are used to control the motion of equipment such as airplane flaps and landing gear, and tractor attachments. Parker Hannifin Corp., also based in Cleveland, is the world's biggest maker of hydraulic equipment.
Cutler in the first quarter began selling units, closing plants and firing workers to hedge against the drop in demand for truck parts. Eaton in November announced plans to scrap factories in Michigan, the U.K. and Spain to reduce excess capacity.
Eaton, which had $11.1 billion in sales last year, also bought companies including Changzhou, China-based Senyuan, which makes electrical components such as vacuum circuit breakers, and a filtration business from New York-based Dover Corp.
Thursday, December 28, 2006
Tuesday, December 26, 2006
Eaton spirit still alive after plant closing threat
By John Green
The Hutchinson News
While awaiting the decision last summer whether Eaton Corp. would shutter its Hutchinson plant, employees were determined about at least one thing: the annual Spirit of Christmas campaign would go on.
On Friday, about a dozen employees loaded their pickup trucks to deliver masses of food and gifts purchased or collected by employees to 44 local families in need, including 115 children.
Employee participation in the effort was up this year, organizers said, though they aren’t sure if that’s because workers recall their own feelings of job insecurity, or because more people were simply asked.
“People out here are really positive about the Spirit of Christmas,” said Sheri Ellis, a senior accountant at the 4th Avenue plant. “Once they’re involved, they really want to look out for these people.”
The program started at the plant in 1950s, Ellis said, long before it was Eaton. The last couple of years, the annual giving campaign has benefited 40 to 50 families each year, Ellis said.
Letters go out in October to churches and schools soliciting the names of families in need.
“It can be for any reason: some are losing their job, some have health issues, it could be a single parent,” she said. “There is no stipulation, just that they are in need.”
There was some expectation, with about 150 layoffs anticipated at the plant in coming months, that there would be greater need internally this year. But only two of the recipients this year are Eaton employees, Ellis said.
“It’s always been that we consider employee needs first,” said Human Resources Director Jim Shantz.
Once a list of names is compiled – this year the list topped 60 people – Eaton volunteers interview each family to find those most in need.
“One rule we have is that we don’t help the same family two years in a row,” Ellis said.
Once families are selected, the children’s names and their gift desires are hung on a tree inside the plant. Employees adopt the children and buy gifts for them.
Money raised through plantwide employee donations and from the corporation, is used to buy the food and food certificates. The budget is about $10,000 annually, Ellis said, of which half goes for food.
“We give them coupons for a turkey, gallon of milk and dozen eggs,” said Jesse Garcia, a master scheduler at the plant and food chairman for the past 20 years. “We put in an assortment of corn, peas, green beans, cranberry, a big box of cornflakes, tomato juice, vegetable juice, peanut butter…. You want me to go on?”
The size of the food box is determined by the size of the household, with enough “for several good meals,” Garcia said. The groceries, also including dish soap and laundry soap, are purchased from Food 4 Less, which discounts many of the items, Garcia said.
“We have a couple of families not even associated with Eaton who go out and buy $500 in toys each year just for our program and donate them,” Ellis said. “A couple schools in the area donate also. Nickerson raised a lot for toys and tricycles this year.”
Bicycles obtained through the annual Reno County Toy Run are also donated to the cause.
“I did notice that of those we helped this year, there were not as many young kids,” Ellis said. “In the past there were a lot more babies through age 5 or 6. This year it was mostly kids in junior high, from 10 to 14 years old. They’re a little tougher to buy for.”
Besides toys, each child gets a gift certificate to Payless Shoe Store, a $10 certificate for use at the Goodwill store and a blanket.
“If there are specific household needs, like towels or sheets or something in particular that they need, we provide that,” Ellis said.
Besides the 30-plus Eaton employees directly involved in the volunteer effort, Prairie Hills Middle School student council and gifted program members and teachers assisted the effort this year, wrapping presents Dec. 16.
“Everybody out here is so generous when it comes to this,” Ellis said. 12/23/2006;
The Hutchinson News
While awaiting the decision last summer whether Eaton Corp. would shutter its Hutchinson plant, employees were determined about at least one thing: the annual Spirit of Christmas campaign would go on.
On Friday, about a dozen employees loaded their pickup trucks to deliver masses of food and gifts purchased or collected by employees to 44 local families in need, including 115 children.
Employee participation in the effort was up this year, organizers said, though they aren’t sure if that’s because workers recall their own feelings of job insecurity, or because more people were simply asked.
“People out here are really positive about the Spirit of Christmas,” said Sheri Ellis, a senior accountant at the 4th Avenue plant. “Once they’re involved, they really want to look out for these people.”
The program started at the plant in 1950s, Ellis said, long before it was Eaton. The last couple of years, the annual giving campaign has benefited 40 to 50 families each year, Ellis said.
Letters go out in October to churches and schools soliciting the names of families in need.
“It can be for any reason: some are losing their job, some have health issues, it could be a single parent,” she said. “There is no stipulation, just that they are in need.”
There was some expectation, with about 150 layoffs anticipated at the plant in coming months, that there would be greater need internally this year. But only two of the recipients this year are Eaton employees, Ellis said.
“It’s always been that we consider employee needs first,” said Human Resources Director Jim Shantz.
Once a list of names is compiled – this year the list topped 60 people – Eaton volunteers interview each family to find those most in need.
“One rule we have is that we don’t help the same family two years in a row,” Ellis said.
Once families are selected, the children’s names and their gift desires are hung on a tree inside the plant. Employees adopt the children and buy gifts for them.
Money raised through plantwide employee donations and from the corporation, is used to buy the food and food certificates. The budget is about $10,000 annually, Ellis said, of which half goes for food.
“We give them coupons for a turkey, gallon of milk and dozen eggs,” said Jesse Garcia, a master scheduler at the plant and food chairman for the past 20 years. “We put in an assortment of corn, peas, green beans, cranberry, a big box of cornflakes, tomato juice, vegetable juice, peanut butter…. You want me to go on?”
The size of the food box is determined by the size of the household, with enough “for several good meals,” Garcia said. The groceries, also including dish soap and laundry soap, are purchased from Food 4 Less, which discounts many of the items, Garcia said.
“We have a couple of families not even associated with Eaton who go out and buy $500 in toys each year just for our program and donate them,” Ellis said. “A couple schools in the area donate also. Nickerson raised a lot for toys and tricycles this year.”
Bicycles obtained through the annual Reno County Toy Run are also donated to the cause.
“I did notice that of those we helped this year, there were not as many young kids,” Ellis said. “In the past there were a lot more babies through age 5 or 6. This year it was mostly kids in junior high, from 10 to 14 years old. They’re a little tougher to buy for.”
Besides toys, each child gets a gift certificate to Payless Shoe Store, a $10 certificate for use at the Goodwill store and a blanket.
“If there are specific household needs, like towels or sheets or something in particular that they need, we provide that,” Ellis said.
Besides the 30-plus Eaton employees directly involved in the volunteer effort, Prairie Hills Middle School student council and gifted program members and teachers assisted the effort this year, wrapping presents Dec. 16.
“Everybody out here is so generous when it comes to this,” Ellis said. 12/23/2006;
Thursday, December 21, 2006
Electrical Equipment outlook positive for 2007
StarMine’s top-ranked analyst at picking Electrical Equipment stocks, Alex Rygiel, of Friedman, Billings, Ramsey, gave us his thoughts on the outlook for this industry in 2007: The Big Trend
Electrical equipment companies have had two good years and while this growth will continue into 2007, some consolidation among these companies is likely. The industry has been looking for ways to return money to investors. The Unconventional Wisdom
Wall Street seems to be somewhat cautious on the weakening residential market and what its impact will be on the nonresidential market. Rygiel believes that the non-residential market will remain at least stable, which is good news for the electrical equipment industry.
Electrical equipment companies have had two good years and while this growth will continue into 2007, some consolidation among these companies is likely. The industry has been looking for ways to return money to investors. The Unconventional Wisdom
Wall Street seems to be somewhat cautious on the weakening residential market and what its impact will be on the nonresidential market. Rygiel believes that the non-residential market will remain at least stable, which is good news for the electrical equipment industry.
Friday, December 15, 2006
Areva, Alstom, & Schneider Electric face fines for Switchgear Cartel
Report12.14.06, 3:51 AM ET
PARIS (AFX) - The European Commission is expected next Wednesday to impose fines on Areva, Alstom and Schneider Electric for forming a cartel in gas insulated switchgear, Les Echos reported, without naming its sources.
Other companies likely to be fined include ABB Ltd , Siemens AG , Mitsubishi and Hitachi, the business daily said.
Gas insulated switchgear is used to regulate flow of electric current and is bought mostly by state-owned power companies and local authorities, with private companies amounting to about a quarter of the market, the report said.
The commission's expected action follows raids on the companies in 2004.
The size of the fines remains unknown but the sanctions are likely to lift the value of the anti-cartel fines imposed by the commission this year to above 2 bln eur from 1.8 bln up to the end of November, Les Echos added.
equitynext@afxnews.com
PARIS (AFX) - The European Commission is expected next Wednesday to impose fines on Areva, Alstom and Schneider Electric for forming a cartel in gas insulated switchgear, Les Echos reported, without naming its sources.
Other companies likely to be fined include ABB Ltd , Siemens AG , Mitsubishi and Hitachi, the business daily said.
Gas insulated switchgear is used to regulate flow of electric current and is bought mostly by state-owned power companies and local authorities, with private companies amounting to about a quarter of the market, the report said.
The commission's expected action follows raids on the companies in 2004.
The size of the fines remains unknown but the sanctions are likely to lift the value of the anti-cartel fines imposed by the commission this year to above 2 bln eur from 1.8 bln up to the end of November, Les Echos added.
equitynext@afxnews.com
Thursday, December 14, 2006
Eaton Electrical to close Puerto Rico Plant
SAN JUAN, Puerto Rico (AP) -- Eaton Corp. will close a circuit breaker assembly plant in Puerto Rico and shift the work to another factory in the U.S. island territory and to the Dominican Republic, a company spokeswoman said Wednesday.
The company will phase out production at the plant in Cabo Rojo, in southwestern Puerto Rico, over the next 18 months and eliminate 315 full-time positions and 70 temporary ones, said Amanda Mushrush, a spokeswoman for Eaton's electrical division.
The production will be shifted to Eaton plants in Arecibo, Puerto Rico, and in Haina, Dominican Republic, Mushrush said.
The plant closure is intended to save money by consolidating manufacturing operations, she said. The company's electrical division operates five assembly plants in Puerto Rico, including the one slated to close in Cabo Rojo, and one in the Dominican Republic.
Eaton Corp., based in Cleveland, Ohio, has about 60,000 employees worldwide and had sales last year of $US11.1 billion (euro8.3 billion).
The company will phase out production at the plant in Cabo Rojo, in southwestern Puerto Rico, over the next 18 months and eliminate 315 full-time positions and 70 temporary ones, said Amanda Mushrush, a spokeswoman for Eaton's electrical division.
The production will be shifted to Eaton plants in Arecibo, Puerto Rico, and in Haina, Dominican Republic, Mushrush said.
The plant closure is intended to save money by consolidating manufacturing operations, she said. The company's electrical division operates five assembly plants in Puerto Rico, including the one slated to close in Cabo Rojo, and one in the Dominican Republic.
Eaton Corp., based in Cleveland, Ohio, has about 60,000 employees worldwide and had sales last year of $US11.1 billion (euro8.3 billion).
Monday, December 11, 2006
2007 Success
Hi Everyone,
Thanks for stopping by. This website is intended to be a communication tool for people interested in whats happening at Eaton Electrical. Please feel free to post your comments.
Thanks for stopping by. This website is intended to be a communication tool for people interested in whats happening at Eaton Electrical. Please feel free to post your comments.
Subscribe to:
Comments (Atom)
