Pall buys five USFilter businesses for $360 million

By Mark A. DeSorbo

East Hills, NY-Pall Corp. has acquired the Filtration and Separations Group of USFilter Corp.(San Diego, CA) in a $360 million deal that officials from both companies say will allow each to broaden products and services in target core markets.

A spokesperson for USFilter declined to comment when asked about the details of the sale, but Diane Foster, Pall's director of investor relations, says USFilter offered the Filtration and Separations Group in a blind auction that was conducted by Lazard Freres & Co LLC (New York City).

“There were a few companies that bid, but nobody knew who else was participating in the auction,” Foster says. “To bid, a company had to submit a letter of intent and a price range. [Lazard] came back to the more serious bidders and the sale moved ahead.”

The Filtration and Separations Group is made up of five units, where products for separating and purifying liquids and gases are manufactured for the food and beverage, microelectronics, biotech and pharmaceutical industries. The group is comprised of USF Filterite (Timonium, MD); USF Fluid Dynamics (DeLand, FL); USF Schumacher (Crailsheim, Germany); SeitzSchenk Filter systems (Waldstetten, Germany) and Exekia (Bazet, France).

Eric Krasnoff, chief executive officer of Pall, sees the acquisition as a way to expand the company's offerings and increase overall revenues. “For customers, this means the ease and reliability that comes with partnering with one supplier for integrated solutions for all their filtration and separation needs,” he says.

The federal government, namely the U.S. Food and Drug Administration (FDA) and the Environmental Protection Agency (EPA), Foster adds, regulates many of Pall's customers, making the need for purity that much more important, if not urgent.

“Often times, with innovations, their processes require increased filtration,” she says. “You cannot innovate without bringing the contamination level down. And as requirements for purity increases, so will the market.”

According to Foster, Pall had been looking to acquire other companies for quite a while. “We are very opportunistic when it comes to acquisitions,” she says. “If something looks like it could be worth our objectives, concerning technology and the markets, we would pursue it.”

The businesses within the acquisition had become non-core sectors for USFilter, says Karole Colangelo, public relations manager for the company. “The acquisition was part of a ongoing strategic review of our businesses,” Colangelo says. “Our focus is on our core water and wastewater businesses. The Filtration and Separations Group was only a small portion of our business and was outside our core businesses, and these units did not contribute to our core.”

All employees of the Filtration and Separations Group became Pall employees once the deal was closed, Colangelo says, adding that the group was a “very strong business sector.”

Like Pall, USFilter, she adds, will also continue to make marketing agreements and acquisitions to broadening water and wastewater technologies.


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