Rockwell to sell mechanical, motor businesses

As announced last week, Rockwell Automation Inc. plans to sell its Dodge mechanical and Reliance Electric motors and motor repair services businesses. These producers of mechanical power transmission products and industrial motors are part of the company’s Power Systems segment. Rockwell says it will retain the Reliance Electric and Reliance-branded drives and related parts and services within its global drives and customer service businesses.

Dodge and Reliance Electric businesses, headquartered in Greenville, SC, account for essentially all the revenue generated by Power Systems. For fiscal year 2006, the segment is forecast to generate about $1 billion in revenue and segment operating margins of around 15%.

The company does not expect the transaction to change its priorities for cash deployment, but says it will augment focus on power and integrated control and information solutions to meet customers’ business needs. Keith D. Nosbusch, chairman and CEO of Rockwell Automation, said that Power Systems has ‘contributed substantially to Rockwell Automation’s growth and success. We believe they will benefit from ownership dedicated to investing and globalizing to sustain their growth as the premier providers of power transmission and conversion solutions.’

Jeanine Katzel, senior editor

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