Friday, July 28, 2017

Schneider Electric buys Asco, raises 2017 guidance

July 27 (Reuters) - French electrical component and energy management group Schneider Electric said on Thursday it was buying automatic transfer switch maker Asco Power Technologies (Asco) for $1.25 billion and raising its full year revenue and margin guidance.
The all-cash deal aims to boost Schneider Electric's position in North America, and enhance its offer for buildings that use autonomous or multi-source power management.
Asco brings to Schneider Electric a well-recognized brand in North America, a strong level of know-how, prescription skills and network and a diversified customer base," Chief Executive Jean-Pascal Tricoire said in a statement.
The company raised its objectives for 2017 on Thursday, following solid growth in its building, industry and IT segments in the first half.
The company is now targeting organic revenue growth between three and four percent for the group, outside infrastructure.
In April, the group confirmed a target of organic revenue growth of between one and three percent outside infrastructure.
The group also said it was now aiming for the upper end of its initial target to increase its organic adjusted core profit (EBITA) margin by between 20 and 50 basis points.
Adjusted organic core profit (EBITA) for the first half of 2017 rose 7 percent to 1.72 billion euros ($2.02 billion), with the margin rising by 60 basis points to 14.1 percent.
The company said it was launching a strategic review of part of its infrastructure business, with "all options being explored".
"The part of the portfolio of c.2 billion euros, that consists mainly of projects and equipment and with a mid-single digit adjusted EBITA level, will undergo additional steps to generate increased efficiency for the business." it said. ($1 = 0.8522 euros)
Asco has been operating as an autonomous part of data center infrastructure provider Veritiv; it posted $468M in revenue during 2016 with an adjusted EBITDA margin of nearly 23%.
Schneider also reports H1 results, with revenues up 3.7% Y/Y to €12.17B and net Income up 18% Y/Y to €958M, and raises its full-year revenue and margin guidance.

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