Like many corporate mergers or acquisitions, the possibility of Milwaukee-based Gardner Denver Inc. combining its operations with the industrial segment of Ingersoll-Rand leaves questions about the impact of a deal on the company’s 143 Milwaukee employees.
The Wall Street Journal first reported the potential deal on Sunday, indicating an announcement could come as soon as this week. Ingersoll-Rand and Gardner Denver are both scheduled to report earnings on Tuesday morning. KKR, the private equity firm that owns around 35% of Gardner Denver stock, is also set to report results Tuesday.
A merger could come with good news for non-management employees at the company. The Wall Street Journal reported the deal would include a $150 million special stock award for that group and their counterparts joining from Ingersoll-Rand.
Gardner Denver made headlines in 2017 when it distributed $100 million in stock to employees as part of its IPO.
The WSJ report indicated the deal would combine Gardner Denver with the Ingersoll-Rand industrial segment. The deal would give Ingersoll-Rand shareholders majority ownership of the new company but Gardner Denver chief executive officer Vicente Reynal would be CEO.
Gardner Denver makes compressor, pump, vacuum and blower products for the industrial, energy and medical markets. The company had nearly $2.69 billion in revenue in 2018 and ranked #854 on the 2018 Fortune 1000 list.
The Ingersoll-Rand industrial segment had $3.32 billion in revenue last year, about 21% of the entire company. The business includes compressed air and gas systems, power tools, material handling systems and fluid management. It also includes Club Car golf, utility and consumer low-speed vehicles.
The WSJ report did not say where the new company would be headquartered.
Ingersoll-Rand has global headquarters in Ireland and North American headquarters in Davidson, North Carolina near Charlotte.
Representatives of Gardner Denver and Ingersoll-Rand did not immediately respond to requests for comment.
Gardner Denver moved its headquarters to Milwaukee in 2014 when current Rev Group CEO Tim Sullivan was leading the company.
In 2015, the Wisconsin Economic Development Corp. awarded the company up to $2 million in tax credits tied to the creation of 200 new jobs and $4 million in capital investment. The city of Milwaukee also made $400,000 available to the company to support the build-out of its new offices.
According to WEDC records, Gardner Denver has created 76 new jobs in Milwaukee along with retaining 67 positions it had when the tax credits were awarded. The company has invested $1.1 million, according to the WEDC. Through the end of 2018, the agency had verified $833,147 in tax credits for the company.
Gardner Denver has not used any of the $400,000 made available by the city, according to tax incremental financing district reports.
Sullivan left Gardner Denver in 2014 and was replaced by former Rexnord CEO Peter Wallace. Reynal took over for Wallace in January 2016.
Reynal, 44, joined Gardner Denver in May 2015. He previously spent 11 years working for Washington, D.C.-based Danaher Corp., along with time at Waltham, Massachusetts-based Thermo Fisher Scientific and Morristown, New Jersey-based Allied Signal Corp. He has a Bachelor of Science in mechanical engineering from Georgia Institute of Technology and Master’s degrees in mechanical engineering and technology and policy from MIT.
