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Rexnord merger with Regal creates $5bn giant with new name

21 October, 2021

The electric motors and mechanical power transmission manufacturer Regal Beloit has completed its merger with Rexnord Process and Motion Control (PMC) to create a new business, Regal Rexnord Corporation. The combined business, employing about 29,000 people and with manufacturing facilities on five continents, is predicted to generate revenues of around $5bn in 2022, with an adjusted Ebitda of more than $1bn. The merger is expected to generate synergies worth at least $120m over the coming three years.

The planned merger was announced in February this year. The new company will have four business segments: Motion Control Solutions; Climate Solutions; Commercial Systems; and Industrial Systems. Its headquarters will be in Milwaukee, Wisconsin, but it will keep a strong presence in in Florence, Kentucky. Global subsidiaries such as Regal Beloit America and Rexnord Industries will not change their legal names at this time.

Regal Rexnord will offer customers an expanded range of products spanning the industrial powertrain. It brings together brands from both Regal and Rexnord PMC, including Regal’s Browning, Grove Gear, Hub City, Jaure, Kop-Flex, McGill, ModSort, Sealmaster and System Plast, and PMC’s Berg, Cambridge, Centa, Falk, Rexnord and Stearns.

As well as hardware, Regal Rexnord will offer IIoT (Industrial Internet of Things) and digital technologies that combine Regal’s Perceptiv and Rexnord’s DiRXN platforms.

Regal Rexnord says that while the benefits from the merger may initially may be more pronounced in the power transmission business, it expects all of its customers to benefit over time. The merger will create a more balanced portfolio with mechanical power transmission products accounting for nearly half of its future sales – twice as much as before. At the same time, motors will drop from 55% of sales to around 38%.

The newly-merged business has a new logo

At a time when global supply chains are constrained, the combined company says it will be able to take advantage of manufacturing facilities around the world to help increase reliability, quality, response time and product availability.

“The addition of PMC is a tremendous positive step forward in Regal's ongoing transformation, positioning our company – the new Regal Rexnord – better than ever before, to create significant value for all our key stakeholders,” says CEO, Louis Pinkham. “We will provide the industry's most complete industrial powertrain solutions – comprised of our high-efficiency motors and critical power transmission components – to enable a range of efficiency and productivity gains for our customers.

“Merging with PMC also positions Regal Rexnord to better fulfil our business purpose – creating a better tomorrow by energy-efficiently converting power into motion,” he adds. “We will do this by providing more energy-efficient systems and solutions, developed with greater intention, that work better together across the powertrain. And we will also improve our cost position by, among other things, working to reduce our manufacturing footprint, leveraging the scale of our purchasing and consuming fewer resources in our production processes.”

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The merger brings together many well-known brands spanning the powertrain market

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