Canadian Manufacturing

Canada pension fund acquires HVAC products firm for $1.1 billion

The pension fund manager is already a part owner of newly-acquired division's parent company.



TORONTO—The Canada Pension Plan Investment Board will pay $1.1 billion for the Air Distribution division of U.K.-based industrial company Tomkins.

The division, which makes heating, ventilating and air conditioning products for commercial and residential buildings, posted 2011 sales of $882.9 million, 92 per cent of which were in North America.

The pension fund investment arm, which invests the $165 billion Canada Pension Plan fund, is already a part owner of Tomkins. It partnered with Toronto-based private equity firm Onex to acquire a portion of the business in 2010.

Tomkins has since sold five other businesses for a total of almost $1 billion.

“With the sale of Air Distribution, we’re nearing completion of our planned disposition program,” said Seth Mersky, a managing director at Onex. “We can now focus our efforts on building value in the core Gates business with a significantly de-levered capital structure.”

The division designs and manufactures grills, registers and diffusers (GRDs), terminal units, fire and smoke dampers, louvers, filters and fans under brand names Titus, Krueger, Ruskin and Hart & Cooley.

The deal is expected to close in the fourth quarter.

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