The acquisition will combine SPX FLOW’s strengths in pumps, valves, and mixers with ITT’s existing industrial-equipment footprint.
- The deal price amounts to 14.2 times SPX FLOW’s projected adjusted earnings before interest, taxes, depreciation, and amortization for 2026.
- About 43% of SPX FLOW’s revenue comes from aftermarket parts and services.
- The transaction is expected to be closed by the end of the first quarter of 2026.
ITT Inc. (ITT) announced on Friday that it has struck a deal with investment firm Lone Star Funds to acquire engineering equipment provider SPX FLOW for about $4.775 billion in a mix of cash and stock.
The acquisition will combine SPX FLOW’s strengths in pumps, valves, and mixers with ITT’s existing industrial-equipment footprint.
Following the announcement, ITT’s stock traded over 2% lower in Friday’s premarket. On Stocktwits, retail sentiment around the stock remained in ‘bullish’ territory amid ‘high’ message volume levels.
Deal Details And Rationale
The acquisition of SPX is priced at a premium, valuing the company at 14.2 times its projected core cash profit or the adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2026.
SPX FLOW brings roughly $1.3 billion in revenue over the trailing 12 months, with around 42% gross margin and a 22% adjusted EBITDA margin. A key driver of this deal would be the stability in the income, as nearly 43% of that revenue comes from aftermarket parts and services.
Expected Benefits
ITT anticipates roughly $80 million in annual cost savings by the third year after the deal closes. The acquisition should also immediately enhance ITT’s gross margin and adjusted EBITDA margin. ITT expects adjusted earnings per share (EPS) to improve in 2026, with double-digit EPS growth in the first full year post-acquisition.
According to a Bloomberg report, this is the largest acquisition in the company’s history. The transaction is expected to be closed by the end of the first quarter of 2026.
ITT stock has gained over 28% year-to-date and over 17% in the last 12 months.
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