The separation will create standalone Water and Electrical companies, both publicly-traded.
The Water company, which had 2016 sales of around US$2.8 billion and will include the Filtration & Process, Flow Technologies and Aquatic & Environmental Systems business groups, will operate under the Pentair name.
The as yet unnamed Electrical company will be home to Pentair’s Enclosures, Thermal Management and Electrical & Fastening Solutions groups. The Electrical business had sales of approximately US$2.1 billion in 2016.
“Separating Water and Electrical to create two pure-play companies is the next logical step in the evolution of Pentair and is consistent with our strategy to continually enhance shareholder value,” said Randall Hogan, Pentair chairman and CEO.
Hogan will retire as Pentair chairman and CEO when the separation is finalized, but will serve as chairman of Electrical.
John Stauch, senior vice president and chief financial officer of Pentair, will be Water’s CEO, while Karl Frykman, president of Pentair’s Water segment, has been named Water’s chief operating officer. Pentair board member David Jones will become chairman of Water.
Pentair expects to complete the separation during the second quarter of 2018.
Last month, Pentair sold its Valves & Controls business to Emerson Electric Co in a US$3.15 billion deal.