Heating and cooling systems maker American Standard Cos. Inc. said on Monday that it reached an accord to sell its bath and kitchen business to funds advised by private equity firm Bain Capital Partners LLC for $1.755 billion.
American Standard said the sale of the bath unit, which has annual sales of $2.4 billion and sells plumbing products under names such as American Standard and Porcher, is expected to be completed in the fourth quarter.
The sale is part of American Standard's plan to split up its three business units. The company is to spin off its vehicle-controls business later this month. It plans to keep its heating and air-conditioning business and change the company name to Trane, its flagship brand.
The Piscataway, New Jersey, manufacturer said it sold Venesta Washroom Systems, a business that is part of the bath and kitchen unit, earlier this year, bringing total proceeds for the bath and kitchen sale to $1.92 billion.
The proceeds will be used to buy back stock and reduce debt, American Standard said in a statement. It added that the buyer has received firm financing commitments.
The vehicle-control business, which provides electronic braking and transmission systems, is scheduled to start trading on the New York Stock Exchange under the name WABCO on Aug. 1.
American Standard shares were up $1.37, or 2.3 percent, to $60.62 in morning trade on the New York Stock Exchange. The stock has risen about 32 percent this year, compared with a rise of 10 percent for rival heating and air conditioning maker Lennox International Inc. (Reporting by Karen Jacobs)