This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Ecolab Agrees To Acquire Champion Technologies For $2.2 Billion

Stocks in this article: ECL

Steve Lindley, Champion Technologies’ Chairman said, “This is a compelling strategic deal that provides us the possibility to fully capitalize on significant energy market opportunities around the world. We have always regarded Ecolab’s Nalco Global Energy Services as a leader in this marketplace with a similar culture and like-minded focus on serving the customer. We look forward to working together with Ecolab to realize the benefits for all of our stakeholders, including our customers and employees.”

Ecolab will pay approximately $1.7 billion in cash and issue approximately 8 million shares of Ecolab common stock, subject to certain adjustments at and after closing.

The transaction is expected to close by year-end and be cash and earnings accretive in 2013, the first full year of the combined entity. Ecolab expects to realize attractive synergies from the Champion transaction totaling a run-rate of approximately $150 million by the end of 2015 through integration activities wholly within the Global Energy Services sector and that it will not impact the Nalco integration work.

Ecolab expects to maintain its strong investment grade credit rating post-acquisition and is planning to return to ‘A range’ metrics within the next three years. Returns on invested capital are also expected to show sustained improvement going forward.

Ecolab expects to complete the remaining $280 million of its previously announced $1 billion share repurchase program in 2013.

Baker concluded by saying, “This transaction enables us to make an important strategic investment in one of our key growth businesses, and we will continue to further develop our core strengths in food safety, healthcare, water and energy as we further build our business. We are excited by the improved position and opportunities Champion brings us to better serve our customers, grow our business, and to deliver continued strong shareholder returns.”

Third Quarter Forecast Update

Ecolab will announce results for its third quarter ended September 30, 2012 on October 30. Ecolab said that it expects adjusted earnings per share for its third quarter to be $0.87, which is at the high end of its previous range and represents 16% growth versus last year; Ecolab also continues to expect that free cash flow for the second half period will be strong, approximating or exceeding net income. Ecolab had previously forecast third quarter adjusted earnings per share to be $0.83 – $0.87. Ecolab expects reported earnings per share for the third quarter ended September 30, 2012 to be $0.80 per share, reflecting approximately a net $0.07 per share of special charges in the quarter.

2 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,672.60 -141.38 -0.79%
S&P 500 2,051.82 -11.33 -0.55%
NASDAQ 4,757.8790 +7.4820 0.16%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs