SPX Corporation Case Analysis

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SPX Corporation

Analyzing Tax-Free Spin-Off of a Business Flow Resulting in Independent Publicly Traded Companies

MANAGEMENT ACCOUNTING PROJECT

GROUP7: Amith C (107)|| Naval Preet Singh (132)|| Utkarsh Trivedi (157)
Year 2015

Contents
Company Profile 2
Business Model 3
SWOT Analysis 3
Porter’s Five Forces: 4
Central Theme 5
SPX’s Strategic Transformation 6
The Two Companies and Its Strengths 7
Future Flow Company 7
Future Infrastructure Company 8
Capital Structures 9
Bank EBITDA Reconciliation 9
Summary 10
Spin-Off Transaction Summary 11
Pro Forma Future Company Reconciliations 12
Benefits of Spin-Off and Road Ahead for New Companies 13
Future Flow Company 13
Future Infrastructure Company 14
References 15

Company Profile
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It will have annual revenue of approximate $3 billion. And it will be positioned for future growth and operational improvements as a leading provider of aftermarket services for food and beverage, Highly engineered flow tech and solutions, energy and power and industrial applications.
It has broad spectrum of component offering this includes different types of centrifugal and reciprocating pumps, different control valves, mixer, filtration and dehydration machines, plate heat exchangers, hydraulic technologies. Apart from these the company provides skidded and full line systems and also after-market services, replacement of components and parts. Business Strengths
• Pure-play flow company, well positioned in attractive end markets with diverse, global customer base
• Broad product offering of highly engineered flow products and well-recognized brands
• Strong organic revenue growth potential through market share gains and end market growth
• Highly attractive aftermarket opportunity with large installed base and significant opportunity to expand customer service footprint and
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It will have annual revenue of approximate $2 billion. And it will be positioned for infrastructure investments and global power market recovery as a lead in power and HVAC market with a variety of offering of unique highly engineered and speciality infrastructure products.
It too has a broad spectrum of products of cooling technology, heat exchangers, pollution control filters, comfort heating products, underground locators. It also includes power transformers residential commercial boilers and fare collection systems.

Business Strengths
• A diversified global infrastructure platform with market leading positions
• Strong brand recognition driven by new product development and innovation
• Well positioned to benefit from power market recovery and global infrastructure investment
• Provides power generation technologies across nearly all fuel sources
• Significant margin expansion opportunities building off recent initiatives
• Multiple platforms for organic and acquisition

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