Within days of completing the sale of its Bobcat, the utility equipment and attachments business units to Doosan Infracore for approximately $4.9 billion (net cash proceeds of approximately $3.75 billion) on 30 November 2007, Ingersoll-Rand Co Ltd today said that it would acquire indoor heating and air conditioning systems maker Trane Inc TT.N, in cash and stock amounting to around $10.1 billion.

Diversified manufacturer Ingersoll-Rand will also assume about $150 million of Trane's net debt.
 
The acquisition, aimed at expanding its own climate control business, would create a global diversified industrial company with expected pro forma 2008 revenue of $17 billion and $2 billion of EBIT, with combined climate control operations yielding a revenue of about $11 billion in 2008.

Under the terms of the deal, Ingersoll will pay $36.50 per share in cash and 0.23 shares of its own stock approximating $47.81.00 in total value per Trane share, based on the closing price as of December 14, 2007. The company says the transaction would be immediately accretive to earnings with an estimated 2008 earning per share of of $4.00. cost and revenue synergies are expected to exceed $300 million by 2010

The deal has received approval from both companies' boards of directors

"The acquisition of Trane meets our long-term objectives of significantly increasing consistency of revenue and income streams, adding strong brands and market positions, and further strengthening the organic growth potential of our portfolio." said Herbert L. Henkel, Ingersoll Rand chairman, president and chief executive officer.

"We believe the new Ingersoll Rand will be capable of sustaining annual organic revenue growth averaging 5-7 per cent and EPS growth exceeding 15 per cent per year, both in excess of our former growth guidance."

Trane Inc, previously named American Standard Companies Inc., provides systems and services that enhance the quality and comfort of the air in homes and buildings around the world. The company offers customers a broad range of energy-efficient heating, ventilation and air conditioning systems; dehumidifying and air cleaning products; service and parts support; advanced building controls; and financing solutions.

Fred Poses, Trane chairman and CEO, will remain in his position until the acquisition is completed, said, "For our shareowners, this offer represents an attractive price for our shares today and the opportunity to participate in a powerful global diversified industrial company in the future. Combining Trane and Ingersoll Rand's climate control operation creates a very strong business."

Henkel said, "Trane's demonstrated long-term organic growth rate, averaging 7 per cent to 8 per cent, compares favourably to the organic growth targets we have established for our business portfolio.

"Based upon market fundamentals such as rising energy costs and conservation initiatives, we expect solid replacement-demand for energy-efficient products and for retrofit and refurbishment of current systems. Trane's large installed base of equipment and systems will provide profitable aftermarket growth potential. Also, Trane has the leading market position in North America, and is growing strongly and increasing penetration in international markets.

Trane's 2007 annual revenues are expected to approximate $7.4 billion.

Earlier in April 2007, Ingersoll-Rand had divested its road development business in April 2007 generated net cash proceeds of approximately $4.8 billion. The com-any had then said that it would continue to use a balanced approach in our investment priorities of organic growth, acquisitions and share repurchases.

Ingersoll Rand is a global diversified industrial firm providing products, services and solutions to transport and protect food and perishables, secure homes and commercial properties, and enhance industrial productivity and efficiency.