Dover Corporation (DOV) announced closure of the previously planned sale of its DEK Printing Machines unit (:DEK) to Hong Kong-listed ASM Pacific Technology.
Dover declared that it has signed a definitive agreement to sell the unit in December last year. The unit had been put on the block for a year. Dover had announced its plan to divest Everett Charles Technologies (including the Multitest business) and DEK, which served the electronic assembly and test markets, at the time of releasing its fourth quarter 2012 results. The businesses were classified as discontinued operations since then.
Subsequently, in Sep 2013, Dover entered into an agreement to sell its Multitest and Everett Charles Technologies (ECT) businesses to LTX-Credence Corporation, now known as Xcerra Corporation for $93.5 million.
DEK came under Dover’s wing when it was acquired in 1983. DEK is a global provider of advanced materials deposition technologies and support solutions including printing equipment platforms, stencils, precision screens and mass imaging processes used primarily in the electronics industry.
The DEK business previously was part of Dover’s former Printing & Identification segment. As per Dover’s new segment structure, organized around its key end markets to better focus on growth strategies, the Printing & Identification platform comes under the Engineered Systems segment. The segment is focused on design, manufacture and service of critical equipment and components serving the printing & identification, vehicle service, waste handling and industrial end markets. The segment generated 34.5% of Dover’s total revenue in the first quarter of 2014.
This current sale along with the previously announced spin-off of certain parts of the communication technologies businesses into a standalone, publicly-traded company will simplify Dover’s business profile and enable it to focus on its key industrial growth spaces – Energy, Fluids, Refrigeration & Food Equipment, and Engineered Systems. Dover will continue to benefit from its active acquisition pipeline in these spaces as well as solid booking and orders growth. Dover’s sound balance sheet coupled with solid earnings growth should allow the company to continue its dividend hike and share repurchases in the years ahead.
Illinois-based Dover is an industrial conglomerate producing a wide range of specialized industrial products and manufacturing equipment. It operates through four major operating segments: Energy, Engineered Systems, Fluids and Refrigeration & Food Equipment.
Dover currently holds a Zacks Rank #2 (Buy). Some other stocks worth considering in the machinery–general industrial sector include Blount International Inc. (BLT), EnPro Industries, Inc. (NPO) and Nordson Corporation (NDSN). While Blount International and EnPro Industries hold a Zacks Rank #1 (Strong Buy), Nordson carries the same rank as Dover.