Johnson Controls names integration leadership team

Expects deal to be finalized in September

Johnson Controls Inc. headquarters
The Johnson Controls Inc. operational headquarters in Glendale.

Glendale-based global multi-industrial firm Johnson Controls Inc. has revealed additional plans for its integration with Irish fire protection and security solutions company Tyco International plc, including the leaders who will guide the combination process.

Johnson Controls Inc. headquarters
The Johnson Controls Inc. headquarters in Glendale.

Mike Bartschat, vice president and chief procurement officer for Johnson Controls, and Bob Roche, senior vice president, Business Finance at Tyco, will co-lead a new Integration Management Office the companies have formed, according to an SEC filing. They will be responsible for choosing the best parts of both companies to design the new Johnson Controls; making sure both companies are ready for the first day of combined operations; finding revenue and expense synergies in both companies; and creating an operating model for the new company that encourages growth and improved customer experience.

The deal, which was announced in January and which the company said in today’s filing it expects will close in September, has an estimated $16.5 billion value. The combined company’s headquarters will be in Cork, Ireland, while the primary North American operational headquarters will be in the Milwaukee area. Johnson Controls previously indicated this structure would mean moving Tyco’s operational headquarters jobs from Princeton, N.J. to Milwaukee. Johnson Controls currently has about 3,400 employees in the Milwaukee area and 130,000 worldwide. Tyco has 57,000 employees in more than 900 locations.

Johnson Controls chief executive officer Alex Molinaroli and Tyco CEO George Oliver will lead the steering committee for the Integration Management Office. The IMO will also include 14 other employee leaders, half from each company, who will focus on the following areas: master planning; finance planning & capture; org, talent, cultural & change management; communications; tax strategy; real estate/footprint; and business processes & systems. There will also be executive sponsors and tower leaders addressing a number of functional areas.

Alex Molinaroli Johnson Controls
Molinaroli discusses his strategy for Johnson Controls Inc. at an event in Milwaukee in October.

Johnson Controls is also in the process of spinning off its automotive seating and interiors segment into a new company, called Adient, which is expected to close October 3.

The filing also included a Q&A for the companies’ employees about the integration process, where leaders explain the reasoning for a merger versus an acquisition.

“This merger is really about a vision for the combined company after the spin of Adient, bringing together two advantaged industries,” the filing says. “Given the relative size and value of Tyco and Johnson Controls following the spin of Adient, a merger is the most appropriate approach to the combination of the two companies. The merger will reflect united leadership and a ‘best of both’ approach as we work through the details of integration.”

They also addressed whether there will be layoffs in the combination of the companies.

“This is a growth move for Johnson Controls, and we expect that we will ultimately create new opportunities across the company as we capture the new prospects this merger will create. Since the agreement has just been signed, we don’t have more specific information at this time. Details of specific organizational plans will be defined through the integration process. As usual, we are committed to being as transparent as we can be with this process, and we will communicate more information as we are able to do so.”

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