Eaton Buys Aerospace Business

Electrical-systems manufacturer Eaton (ETN Quote) announced Thursday that it has agreed to acquire AT Holdings, the parent company of Argo-Tech, for $695 million.

The deal, which is expected to close in the first quarter, won't include AT Holdings' cryogenics and other nonaerospace businesses. Eaton predicts that the purchase of the engine fuel-systems provider will allow its aerospace operations to reach roughly $1.5 billion in annual revenue.

The acquisition "adds an important component to Eaton's aerospace fuel-system strategy," said Alexander Cutler, Eaton chairman and chief executive, in a statement. "Argo-Tech will strengthen our aerospace operations by providing Eaton with a total fuel-system capability, attractive aftermarket opportunities and an increased portfolio and customer base."

For the 2006 fiscal year, Argo-Tech's aerospace business reported sales of $206 million.