Chart Industries, a company based near Ball Ground that makes cryogenic tanks and other thermal management equipment, is merging with Flowserve, an industrial firm based in Texas.
The merged firm will be based in Dallas, Texas, according to the two companies in an announcement Wednesday. Chart CEO Jill Evanko said during an investor conference call that the combined company expects to maintain a presence in Atlanta.
It’s unclear what the merged firm will be called, but the combined company will have an enterprise value of about $19 billion, and the two companies have combined 12-month revenue of about $8.8 billion.
The merger will be an all-stock “merger of equals” transaction that’s expected to close in the fourth quarter of this year, subject to approvals by shareholders and regulators, the companies said.
Chart shareholders will get 3.165 shares of Flowserve common stock per share of Chart common stock. The boards of both companies have already unanimously approved the deal.
Chart is a major employer in Cherokee County, north of Atlanta, according to the Cherokee County Chamber of Commerce’s website. Its headquarters are near the Cherokee County Regional Airport, which sits between Canton and the town of Ball Ground, which has about 3,500 residents, according to the city’s website.
Along with making compressors, fans, cryogenic tanks, heat exchangers and other industrial equipment, Chart also makes carbon dioxide beverage systems used by restaurant chains to carbonate soft drinks and as dosing systems for liquid nitrogen used in food preservation, freezing, craft brewing and nitro coffee, according to its website.
Flowserve makes industrial pumps, valves, seals and actuators.
Merging the two companies will create “a more resilient and diversified business” with greater global reach, Evanko told investors. She said the combined company will be better able to capitalize on global trends, including a growing need for energy, driven by growth in artificial intelligence and data centers.
The companies also hope to take advantage of demand for decarbonization, investments in nuclear energy, electrification and liquefied natural gas, reshoring of manufacturing and upgrades of aging infrastructure. A key area of growth for the companies is the Middle East, where officials are making vast investments in infrastructure.
Flowserve CEO Scott Rowe said combining the two companies will allow them to deliver complete systems to a broader range of customers, with “full life-cycle support” — from engineering and design to installation to providing spare parts, repairs and equipment upgrades.
That is aimed at gaining a better standing against competitors, including industrial giants Ingersoll Rand and Dover.
In the merger, the companies expect to generate about $300 million in annual “cost synergies” within three years through “organizational efficiencies,” consolidation, saving money on procurement and materials and eliminating duplicate costs for operating a public company.
“While we have a very complimentary geographic and manufacturing and service center footprint, there are some opportunities for us to consolidate excess capacity together within certain regions,” Evanko said.
Chart said its “primary employee pool” is in Ball Ground, but the company declined to say how many employees it has based in Georgia or give additional details on how they will be affected.
Rowe said during the investor call that “what makes this combination truly special is our shared set of values and commitment to supporting associates and customers that will carry on as a combined company.”
“Both our businesses recognize that our associates are the bedrock of our success,” he added.
Evanko will become board chair for the combined company, while Rowe will become CEO.
After the deal closes, the combined company will have a new name, which will be announced “at a later date.”
The Chart-Flowserve merger follows Chart’s 2023 acquisition of air and gas handling firm Howden for $4.4 billion.
About the Author
Keep Reading
The Latest
Featured
