A. O. Smith to acquire Lochinvar Corporation
The news that A. O. Smith Corporation in the USA is to take over Lochinvar Corporation has been welcomed by the managing director of Lochinvar’s UK Subsidiary David Pepper as a ‘wholly positive development’. The $418 million acquisition is expected to be completed in the fourth quarter of 2011.
Ajita Rajendra, president of A. O. Water Products Company, said, ‘The addition of Lochinvar expands our product offering and gives us access to proven high-efficiency boiler technology. The $1.1 billion North American boiler industry is in the midst of a transition to the new high-efficiency condensing technology, which we believe is growing several times faster than GDP. We expect high-efficiency boiler products to continue to grow at an accelerated rate for the foreseeable future. ‘We also believe there are significant growth opportunities outside of North America for Lochinvar’s high-efficiency boilers as more commercial customers seek ways to save energy and reduce operating costs.’
David Pepper explains, ‘We have already been told that the new owners intend to maintain the two brands and run the companies as separate businesses.
‘It is extremely significant that Ajita Rajendra focuses on our “proven high-efficiency boiler technology” as a key motivation for the purchase. This is an area of major potential growth worldwide. By bringing the two companies together, the management has created a platform for us to exploit that growth to the full.’