IDEX Corporation (IEX - Analyst Report), an applied solutions company, recently acquired England based private company FTL Seals Technology Ltd., which specializes in custom made products for the oil & gas, marine markets and power generation. The acquisition price of 24.0 million euros (approximately $31.0 million), was paid in cash.
Constructed around 35 years ago, FTL Seals offers a wide range of sealing and moulding products like hydraulic seals, mechanical face seals, heavy duty seals, rotary shaft seals and precision mouldings, to name only a few.
Subsequent to the acquisition, FTL Seals will become a part of IDEX’s Health and Science Technologies segment, where it will operate with Precision Polymer Engineering, acquired by IDEX in Apr 2010.
It is expected that both these businesses, Precision and FTL, working together, will create substantial revenue and cost synergies for IDEX. The new joint business will not only expand IDEX’s product portfolio but will also help gain market share in the industry.
Late last month, IDEX reported mixed fourth quarter 2012 results. The company’s earnings of 69 cents per share beat the Zacks Consensus Estimate of 67 cents by 3.0%, whereas revenue of $490.8 million missed the Zacks Consensus Estimate of $492.0 million by 0.2%.
At the end of the quarter, IDEX had a strong balance sheet with the option of utilizing the available cash for strategic acquisitions. Organic growth for the company as estimated to be low to a middle single digit.
IEX currently holds a Zacks Rank #3 (Hold). Other stocks worth a look in the diversified machinery industry are Altra Holdings Inc. (AIMC - Analyst Report) and The Babcock & Wilcox Company ; both holding a Zacks Rank #1 (Strong Buy). Another stock Gardner Denver Inc. holds a Zacks Rank #2 (Buy).