Cooper acquired by global giant

Cooper acquired by global giant

One of Peachtree City’s largest companies is being acquired by a global leader. Signify, the world leader in lighting, announced Oct 16 that it has entered into a definitive agreement with Eaton to acquire Cooper Lighting Solutions for USD 1.4 billion (approx. EUR 1,270 million) in cash. Closing is subject to regulatory approvals and other customary conditions and is expected to take place in the first quarter of 2020.

According to the company’s press release, Cooper Lighting Solutions, headquartered in Peachtree City  is a leading provider of professional lighting, lighting controls, and connected lighting. The business offers a large breadth of products and applications, both in the indoor and outdoor segments, sold under renowned brands in North America including Corelite, Halo, McGraw-Edison, Metalux. The company sells its lighting portfolio through a strong agent network and has direct relationships with retailers, distributors and other end-user customers.  

According to a press release:

“This acquisition is fully in line with Signify’s strategy to expand in attractive markets, enhancing Signify’s position in the North American market and improving the business mix. 

“Together, the two businesses will be better positioned to benefit from the growing $12 billion professional lighting market in North America, driven by the continued conversion to LED and the increased demand for connected lighting systems and controls.”

Signify and Cooper Lighting will maintain separate front offices: sales forces, agent networks, product and brand portfolios, marketing and product development teams. Both businesses will be able to strengthen their respective product portfolios, benefiting from an increased power of innovation as well as more competitive and cost-efficient offerings. 

The transaction is expected to generate substantial cost synergies of more than $60 million per year, largely to be achieved in the first three years. These tangible and well-identified cost synergies will stem from savings in the bill of materials as well as from supply chain and sourcing optimization.

Upon closing of the acquisition, Signify will generate over 50 percent of its sales in the Professional segment, increasing the revenue base for its growing profit engines from EUR 4.9 billion to EUR 6.4 billion. The proportion of sales generated in the Americas increases from 28 percent to 40 percent. 

The press release notes the acquisition is fully financed with debt, with committed bridge financing arranged. Signify intends to replace the bridge loan and the existing term loan debt obtained at IPO with a new financing structure before or shortly after the closing of this transaction.