SKF, the world's biggest maker of industrial bearings, saw its share price surge more than 10% on Oct. 19 after announcing better-than-expected third quarter results and the purchase of lubrication systems maker Lincoln Industrial. The purchase price was one billion dollars (718.6 million euros.)
"The acquisition of Lincoln Industrial combined with our existing business will significantly improve our ability to further support our customers with even better solutions and give us a better geographical coverage," SKF chief executive Tom Johnstone said.
The St. Louis-based company, described as "a leading supplier of lubrication systems, tools and equipment" including hose reels and grease guns, employs 2,000 and is expected to generate sales amounting to nearly $400 million, half of them in North America, this year.
"Lincoln Industrial is highly complementary to SKF's existing lubrication systems business with limited overlap," SKF said.
For the July-to-September period, SKF posted a net profit of 1.39 billion kronor (US$208 million), up from 462 million kronor during the same quarter a year earlier, as sales soared 16% year-on-year to 15.47 billion kronor.
"We expect our sales to continue to develop positively in the fourth quarter," Johnstone said. SKF also raised its main financial targets for its operating margin from 12% to 15%.
Copyright Agence France-Presse, 2010