ABB to divest Mechanical Power Transmission division (Dodge) for $2.9 bn

ABB today announced it has signed a definitive agreement to divest its Mechanical Power Transmission division (Dodge) to RBC Bearings Incorporated (Nasdaq: ROLL), for $2.9 billion in cash. The transaction will create a leading manufacturer of highly engineered, performance-critical bearings and motion control components. The transaction is expected to be completed by the end of the year 2021, subject to customary closing conditions, including regulatory review.

For more than 140 years, the Dodge business has been a leader in the design, production, and marketing of mounted bearings, enclosed gearing, and power transmission components. It offers one of the broadest portfolios of mechanical power transmission products in the market, selling to industries such as surface mining, aggregates & cement, warehousing and food & beverage.

Dodge has roughly 1,500 employees worldwide and achieved revenues of approximately $600 million for the last twelve months ending 30 June 2021, of which more than 90 percent were generated in the Americas. The operating EBITA margin was approximately 23 percent. It produces at six manufacturing sites - 5 in the U.S. and 1 in China - and its headquarter is located in Greenville, South Carolina. The president of the division is Roger Costa.

ABB expects to book a non-operational pre-tax book gain of approximately $2.2 billion on the sale of Dodge. ABB also expects the transaction related cash tax outflows to be approximately $400 million.

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