ABB completes divestment of Mechanical Power  Transmission division (Dodge)

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Z U R I C H , S W I T Z E R L A N D , N O V E M B E R 1 , 2 0 2 1

 

 

ABB has completed the divestment of its Mechanical Power Transmission division (Dodge) to RBC Bearings Incorporated (Nasdaq: ROLL), for $2.9 billion in cash. With the divestment, ABB has completed the first of the three previously announced exits from divisions. It is an important milestone in ABB’s strategy of active portfolio management and further strengthens its balance sheet.

 

ABB expects to book a non-operational pre-tax book gain of approximately $2.2 billion on the sale of

Dodge in the fourth quarter of 2021. In addition, ABB expects to record an expense of approximately

$200-250 million for income taxes and pay cash taxes of approximately $400 million due to the transaction. In line with the company’s capital allocation priorities, ABB plans to use the proceeds from the transaction to fund organic growth, pay a rising, sustainable annual dividend per share over time, make value-creating acquisitions, and if applicable return additional capital to shareholders through share buybacks.

 

The transaction creates a leading manufacturer of highly engineered, performance-critical bearings and motion control components. Dodge has roughly 1,500  employees worldwide and achieved revenues of approximately $600 million for the twelve months ending June 30, 2021, of which more than 90 percent were generated in the Americas. During that period, the Operational EBITA marginwas approximately

23 percent.

 

Important notice about forward-looking information

 

This press release contains forward-looking statements relating to the divestment by ABB of its Mechanical Power Transmission division (Dodge). Such forward-looking statements can be identified by words such as plans, intends, expects, and other similar terms. Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could delay, divert or change any of them, and could cause actual outcomes and results to differ materially from current expectations. Among other risks, there can be no guarantee that the expected benefits of the divestment will be realized. No forward-looking statement can be guaranteed. Forward-looking statements in the press release should be evaluated together with the many uncertainties that affect ABB’s business, particularly those identified in the cautionary factors discussion in ABB’s Annual Report on Form 20-F. ABB undertakes no obligation to publicly update any forward-looking statement, whether

as a result of new information, future events, or otherwise.

1 For a definition of Operational EBITA see the Supplemental Reconciliations and Definitions in the Q3 2021 Financial

Information found at global.abb/group/en/investors/results-and-reports/2021

ABB (ABBN: SIX Swiss Ex) is a leading global technology company that energizes the transformation of society and industry to achieve a more productive, sustainable future. By connecting software to its electrification, robotics, automation, and motion portfolio, ABB pushes the boundaries of technology to drive performance to new levels.  With a history of excellence stretching back more than 130 years, ABB’s success is driven by about 105,000 talented employees in over  100 countries. www.abb.com

 

For more information please contact:
Media Relations

Phone: +41 43 317 71 11

Email: media.relations@ch.abb.com

Investor Relations

Phone: +41 43 317 71 11

Email: investor.relations@ch.abb.com

ABB Ltd

Affolternstrasse 44

8050 Zurich

Switzerland

 

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