ELMIRA — Hardinge Inc. (NASDAQ: HDNG), a global manufacturer of metal-cutting tools, announced today that it has agreed to acquire Michigan–based Forkardt from Illinois Tool Works, Inc. (NYSE: ITW) for $34 million.
Elmira–based Hardinge said it will fund the acquisition, which was expected to be completed today, with a combination of cash and debt. It expects the deal to increase its earnings this year.
With well-established brands, Forkardt includes companies that are global providers of high-precision, specialty, and customized workholding devices for machine tools, Hardinge said in a news release. Workholding devices are used to hold a part in place to work on it.
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Forkardt’s headquarters and U.S. operations are in Traverse City, Mich. It also has operations in France, Germany, and Switzerland.
“Our acquisition of Forkardt will strengthen and expand our leadership position in specialty workholding solutions around the world,” Richard L. Simons, chairman, president, and CEO of Hardinge, said in a news release. “Our strategy is to diversify our product offerings in workholding, accessories and spare parts as a means of reducing the impact of the highly cyclical nature of machine tool sales. These products tend to be more stable despite economic cycles and typically also have higher margins.”
Historically, accessories and repair parts have generated an average of about 22 percent to 25 percent of Hardinge’s total revenue, he added. Going forward, the company expects that to rise to 30 percent.
Forkardt was founded in Germany in 1923 by Paul Forkardt, as a manufacturer of chucks. In 2004, Forkardt merged with ITW Workholding, a North American manufacturer of workholding devices. The combined company’s brands include: Forkardt, NA Woodworth, Buck Chuck, Sheffler Collet, and Logansport Cylinder, according to Hardinge.
Forkardt’s revenue last year totaled $47 million.
William Sepanik, formerly group general manager of Forkardt, will be appointed vice president – Forkardt and will report to the Hardinge CEO.
The design, manufacturing, sales, and distribution of Forkardt’s accessory products will be completely separate from Hardinge’s machine-tool manufacturing operations and sales, Hardinge noted.
Hardinge, also announced today that its first-quarter profit fell from $2.4 million, or 21 cents a share, in the year-ago period, to $40,000, or 0 cents a share, this quarter. Net sales also declined from $74.7 million a year earlier to $67.2 million in this year’s first quarter.
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