Last updated on May 16th, 2022 at 09:52 pm
Glendale-based Johnson Controls Inc. is discussing a potential purchase of Reading, Pa.-based industrial battery manufacturer EnerSys, according to a Wall Street Journal report that cited “people familiar with the matter.”
A spokesman for Johnson Controls, which makes building HVAC systems and auto parts and batteries, declined to comment on the rumors.
EnerSys, which makes batteries used in motive power applications such as forklifts and mining and reserve power solutions such as telecom, generated fiscal 2015 revenue of $2.5 billion, according to an analysis by Robert W. Baird analyst David Leiker, CFA.
While Johnson Controls made industrial batteries until 1998 and has since focused on automotive and agm deep cycle battery manufacturing, this transaction would make sense for the company, which has recently divested several divisions, Leiker said.
“There appears to be very little overlap between JCI and Enersys in market,” he said in the report. “This would reengage JCI in the industrial battery space while immediately taking a leading position.”
In addition, Johnson Controls chief executive officer Alex Molinaroli has discussed using strategic growth to strengthen the company’s “core” industrial business, Leiker said in his report. The “new” Johnson Control also has more leverage to use for mergers and acquisitions, and the combination could result in cost savings through joint procurement and R&S and optimized manufacturing, he said.