ITT Corporation to Spin Off Water, Defense Businesses
The company will separate its businesses into three corporations, focusing on technology, water, and defense and information.
The board of directors of ITT Corporation has unanimously approved a plan to separate the company’s businesses into three distinct, publicly traded companies:
- ITT Corporation will continue to be a diversified global manufacturer of highly engineered industrial products and high-tech solutions.
- A new corporate brand name will be formed through the combination of three of ITT’s current businesses: Residential & CommercialWater, Flow Control and Water &Wastewater (including biological, filtration and disinfection treatment and analytics).
- The existing Defense & Information Solutions segment will be renamed and rebranded as a new standalone company that provides innovative technologies and operational services to meet the requirements of military, government and commercial customers.
Under the plan, ITT shareholders will own shares in all three corporations following the completion of the transaction, which should be finalized before the end of 2011.
Steve Loranger, chair, president and chief executive officer, said: “In recent years, we have nurtured and grown our unique portfolio of businesses, which are now poised to emerge as three strong and focused standalone companies, with leading products and market positions, highly skilled employees and tremendous value-generating potential for shareowners. Each new company will be more nimble and able to build stronger, more intimate customer relationships to accelerate mutual success.”
According to its press release, the company will have leading market positions across an extensive portfolio of advanced technology industrial pumps, valves and control systems serving the oil and gas, mining, chemical, power generation, and pulp and paper markets. It also will have leadership positions in highly engineered products such as specialized and harsh-environment connectors, aerospace valves, actuators and components, as well as shock absorbers, brake pads and other energy absorption solutions.
The portfolio of the water technology corporation will span the transport, testing and treatment of water ─ focusing on residential, commercial, municipal, agricultural, construction, building services, dewatering, beverage and leisure marine markets, as well as analytical instrumentation for water and wastewater, environmental, medical and beverage applications.
The standalone defense and information solutions corporation will include premier technologies such as next generation night vision, integrated electronic warfare, networked communications, force protection, radar, global intelligence, surveillance and reconnaissance systems, composite structures, space-based satellite imaging, weather and climate monitoring, and navigation and imaging systems, as well as maintenance, engineering and professional services.
Effective upon the completion of the transaction, the new ITT Corporation will be led by ITT’s current Chief Financial Officer Denise Ramos, who will serve as its future CEO.
The water technology businesses will be led by Gretchen McClain, currently president of ITT Fluid and Motion Control, who will serve as its future CEO. The defense and information company will be led by David Melcher, currently president of ITT Defense & Information Solutions, serving as its future CEO.
Each corporation will have its own independent board of directors, and each of ITT’s current board members has committed to serve on one or more of the boards of these companies. Upon completion of the transaction, each company is expected to be listed on the New York Stock Exchange.