Applied Industrial Technologies’ $768 million Acquisition of FCX Performance, Inc.


White & Case LLP has advised FCX Performance, Inc. and its controlling investor Harvest Partners on the deal

Applied Industrial Technologies (NYSE:AIT) has reached a definitive agreement to acquire FCX Performance, Inc. (FCX), a leading distributor of specialty process flow control products and services based in Columbus, Ohio, for total consideration of approximately $768 million, subject to customary adjustments, and is expected to close within 30 days, upon completion of the Hart-Scott-Rodino waiting period and satisfaction of other customary conditions. The transaction will be financed with a new credit facility comprised of a $780 million Term Loan A and $250 million revolver, effective with the transaction closing.

FCX is the premier distributor of highly engineered valves, instruments, pumps, and lifecycle services to MRO and OEM customers across diverse industrial and process end markets. The company’s comprehensive value-added solutions help customers improve cost productivity, reduce downtime, increase efficiency and effectively meet increasing regulatory compliance standards. FCX operates 68 locations with more than 1,000 team members.

The acquisition is anticipated to contribute approximately $550 million in sales and $68 million in EBITDA in the first 12 months of Applied ownership, prior to recognition of one-time transaction expenses and the impact of purchase accounting adjustments. Additionally, the transaction is expected to be accretive in fiscal year 2019 following recognition of related one-time transaction costs in fiscal year 2018.

The White & Case team that advised on the transaction was led by partners Oliver Brahmst (Picture), Brian Smarsh, Sang Ji, Henrik Patel, Arlene Hahn, Steven Lutt and Joseph Brazil in New York and Rebecca Farrington in Washington, DC. The team was supported by counsels Jeffrey Ii and Seth Kerschner and associates Jessie Baxter, Matthew Hendy, Ming-Ran Qu, Hannah Lee, Jake Jung, DeVoia Stewart, Jeremy Apple, Serena Hsieh, Julianne Prisco, Elizabeth Kirk, Ruben Henriquez, Elle Davis and Daniel Rosenthal.

Involved fees earner: Oliver Brahmst – White & Case; Brian Smarsh – White & Case; Jessie Baxter – White & Case; Matthew Hendy – White & Case; Ming-Ran Qu – White & Case; Hannah Lee – White & Case; Julianne Prisco – White & Case; Sang Ji – White & Case; Woong Jae Jung – White & Case; Henrik Patel – White & Case; Jeffrey Ii – White & Case; DeVoia Stewart – White & Case; Arlene Hahn – White & Case; Jeremy Apple – White & Case; Serena Hsieh – White & Case; Steven Lutt – White & Case; Joseph Brazil – White & Case; Elizabeth Kirk – White & Case; Ruben Henriquez – White & Case; Rebecca Farrington – White & Case; Daniel Rosenthal – White & Case; Seth Kerschner – White & Case;

Law Firms: White & Case;

Clients: Harvest Partners LP; FCX Performance, Inc.;

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Author: Ambrogio Visconti