DOW JONES NEWSWIRES
Thomas & Betts Corp.'s (TNB) fourth-quarter earnings rose a
better-than-expected 42% as the electrical component maker
continued a consistent run of double-digit revenue growth, aided by
strong results in its steel-structures segment.
Switzerland's ABB Ltd (ABBN.VX) said Monday it has agreed to pay
$3.9 billion in cash for Thomas & Betts to increase its
exposure to the U.S. low-voltage electrical equipment market. The
power and technology group said it is paying $72 a share for Thomas
& Betts, a major North American supplier of power transmission
lines and electrical conduits, as well as heating and ventilation
products.
The acquisition price represents a 24% premium to Thomas &
Betts's closing share price on Friday and a 35% premium to its
average stock price over the past 60 trading days, ABB said.
Thomas & Betts's results have been helped in recent quarters
by improving demand, particularly from industrial and utility end
markets. In 2010, the company shed a nonstrategic communications
products business, helping it to place greater focus on its
electrical segment.
The company reported a profit of $56.8 million, or $1.08 a
share, up from $40 million, or 76 cents a share, a year earlier.
Excluding income tax adjustments and facility consolidations,
earnings from continuing operations rose to $1 from 77 cents.
Revenue rose 13% to $603.6 million.
Analysts polled by Thomson Reuters projected per-shares earnings
of 90 cents on revenue of $589 million.
Gross margin improved to 32.1% from 29.8%.
The electrical segment, which accounts for the vast majority of
its revenue, reported 7.8% higher sales on strong organic growth.
Its smaller steel-structures segment saw sales jump 40% on higher
demand and improved pricing as utilities have increased spending on
electrical transmission projects.
For the new year, the company forecast earnings of $3.90 to
$4.20 a share, in line with expectations of $3.92.
Shares closed Friday at $57.95 and were inactive premarket. The
stock is up 11% over the past three months.
--By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108;
ben.rubin@dowjones.com