Curtiss-Wright Corporation (NYSE: CW) today announced that it has completed the acquisition of the Dresser-Rand Government Business (Dresser-Rand), a business unit of Siemens Government Technologies which is a wholly-owned U.S. subsidiary of Siemens AG in Germany, for $212.5 million in cash. Dresser-Rand is a leading designer and manufacturer of mission-critical, high-speed rotating equipment solutions, including reciprocating compressors, steam turbines and steam system valves, supporting most major U.S. Navy shipbuilding programs. In addition, Dresser-Rand is the sole supplier of steam turbines and main engine guard valves on all aircraft carrier programs.
The acquisition significantly increases Curtiss-Wright’s footprint on U.S. Navy Nuclear vessels, expands our existing U.S. Navy aftermarket business and provides an opportunity to leverage Dresser-Rand’s prominent presence at U.S. Navy shipyards. Through its three service centers, it is a leading provider of ship repair and maintenance for the U.S. Navy’s Atlantic and Pacific fleets.
The business will operate within Curtiss-Wright's Power segment and its sales are principally to the naval defense market, with additional sales to the power generation market. The acquisition supports our long-term financial objectives for increased sales growth, margin expansion and strong free cash flow generation. Excluding the effects of purchase accounting, it is expected to be accretive to Curtiss-Wright's 2018 earnings per share and produce a free cash flow conversion in excess of 100%.
Dresser-Rand equipment is used on hundreds of U.S. Navy ships to provide power and compression for propulsion, pump drives, ship service air, oxygen/nitrogen (O2N2) feed air, generator drives, and deballasting. The service centers primarily focus on overhauls of Dresser-Rand legacy equipment, emergent U.S. Navy shipyard repair needs and global service work pursuant to several key OEM service agreements. Dresser also produces the Terry©-branded steam turbine feedwater pumps for the commercial nuclear power market. The Dresser-Rand government business employs approximately 150 people.
