Flowserve Corporation, a leading global provider of fluid motion and control products and services, announced it has acquired the remaining 50 percent of shares needed to have full ownership interest in Niigata Worthington in Kawasaki, Kanagawa, Japan. Flowserve previously owned 50 percent of Niigata Worthington in a long-term joint venture.
Niigata Worthington, a premier manufacturer of certain Flowserve pumps and other rotating equipment, reported sales of approximately $64 million in 2007. Flowserve recorded approximately $2 million for its 50 percent share of net income from the joint venture in 2007, using the equity method of accounting.
The transaction will be completed through cash and assumed liabilities totaling approximately $12 million. Other terms of the purchase were not disclosed.
Due to the size and timing of this remaining 50 percent share acquisition, Flowserve does not believe it will have a material impact on its results for the quarter ending March 31, 2008.
"This acquisition reflects our strong commitment to serving our customers - both end users and contractors - in this key Asia-Pacific region with products, service and support," said Tom Ferguson, president of Flowserve Pump Division. "Niigata Worthington has an excellent reputation as a world-class manufacturer of rotating equipment and services in this region."
Niigata Worthington provides Flowserve with a well-respected regional market leader in the industry, as well as an experienced employee base that can further continue to grow the company's aftermarket services business in the region. The acquisition also enhances Flowserve's ability to provide aftermarket support for the installed base of hydraulic decoking pumping systems, a key company product in Japan.
"With sales offices in several important locations and proven manufacturing capability, this acquisition further enhances our ability to serve the life cycle needs of our customers in the Asia-Pacific region and provides an excellent local platform for long-term growth within the region's oil and gas, chemical and power market sectors," added Ferguson.
With 100 percent ownership, Flowserve now expects increased opportunities to grow the sales and profitability of Niigata Worthington. The company plans to invest in the growth of the Niigata Worthington business and work to transfer its global best practices to further drive efficiencies throughout the organization.
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