ITW Enters Into Agreement to Sell Its Finishing Businesses to Graco Inc.

ITW's finishing equipment businesses consist of paint spray systems and technologies for a variety of industrial end-markets and applications around the world. Key businesses include Gema, Ransburg, DeVilbiss, BGK and Binks. These businesses are leaders in wet industrial finishing as well as powder paint equipment and drying technologies. The finishing businesses revenues were $305 million in 2010.

GLENVIEW, Ill. — Illinois Tool Works Inc. (ITW) has entered into a definitive agreement to sell its finishing group of businesses to Graco Inc., in a $650 million cash transaction.

ITW’s finishing equipment businesses consist of paint spray systems and technologies for a variety of industrial end-markets and applications around the world. Key businesses include Gema, Ransburg, DeVilbiss, BGK and Binks. These businesses are leaders in wet industrial finishing as well as powder paint equipment and drying technologies. The finishing businesses revenues were $305 million in 2010.

Founded in 1926, Graco is a world leader in fluid handling systems and components. Graco’s revenues totaled $744 million in 2010.

ITW said it intends to utilize after-tax proceeds from the sale to repurchase shares as part of its share repurchase program.

"ITW’s finishing businesses offer a variety of premium worldwide brands which collectively represent a very valuable asset," said David Speer, chairman and CEO. "We believe the sale of these assets to an industry leader like Graco presents our finishing businesses with an excellent opportunity to optimize their long-term growth and profitability."

ITW added that the sale is not expected to be complete until June at the earliest, to accommodate regulatory reviews.