Tyco International Announces Plan to Separate Into Three Independent, Publicly Traded Companies

 

All Three Businesses are Leaders in Their Respective Markets Businesses are Well-Positioned for Growth and Value Creation

SCHAFFHAUSEN, Switzerland, Sept. 19, 2011Tyco International Ltd. (NYSE: TYC) announced today that its Board of Directors has unanimously approved a plan to separate the company into three independent, publicly traded companies.

The three companies created through the separation will consist of:

  • ADT North America residential security business, a North American leaderd in providing security for homes and small businesses
  • A world leader in provider of flow control products and services; and
  • A world leader in commercial fire and security business.

“Over the last four years, we have strengthened our competitive position in our core security, fire and flow control businesses by driving organic growth, investing in R&D and technology, increasing efficiency and productivity and making strategic acquisitions,” said Tyco Chairman and Chief Executive Officer Ed Breen. “Today, each business is in a strong financial position and has exceptional brands, highly skilled employees and talented, experienced leadership.”

“In carefully evaluating the opportunities for these businesses and for Tyco as a whole, the Tyco Board of Directors concluded that creating three independent, public companies is the next logical step for Tyco,” said Breen. “All three companies will have industry-leading positions in large and fragmented industries and enhanced capabilities to serve their distinct customers. Importantly, the new standalone companies will have greater flexibility to pursue their own focused strategies for growth — both organic and through acquisitions — than they would under Tyco’s current corporate structure. This will allow all three companies to create significant value for shareholders.”

The company intends to accomplish the separation by issuing tax-free stock dividends of the ADT and flow control businesses to Tyco shareholders, after which Tyco shareholders will own 100% of the equity in each of the three publicly traded companies. Tyco expects to complete the transaction in approximately 12 months, subject to certain conditions including the approval of Tyco shareholders.

Upon completion of the transaction, it is contemplated that Breen will become non-executive chairman of the commercial fire and security company, a director of the flow control company, and a consultant to the ADT North America residential company. In addition, current Tyco directors are expected to serve on the boards of each of the three companies, including the roles of non-executive chairman of the flow control company and the ADT North America residential company.

“We will have strong leadership teams at the board and management levels of all three companies, enabling each business to take full advantage of the attractive growth opportunities that lie ahead,” said Breen.

Creating Three Industry-Leading Companies with Strong Growth Potential

ADT North America Residential

The standalone ADT North America residential business will be the leading provider of security and fire alarm systems in North America, serving more than 6 million residential homes and small businesses. ADT designs, sells, installs, monitors and maintains these systems, and provides video, health, and interactive services to the home. The business will have annualized revenue of approximately $3 billion and approximately 16,000 employees. Naren Gursahaney, the current president of Tyco’s security solutions segment, will become the new company’s chief executive officer.

Flow Control

As a standalone company, the existing flow control segment will be the leading global manufacturer of flow control products. The company designs, sells and services highly engineered valves and controls for the energy markets, general process industries, mining and water markets. The company’s activities also include the design, installation and service of heat management systems for the energy and general process industries, as well as water transmission pipelines and other water/wastewater products. The business will have annualized revenue of approximately $4 billion and approximately 15,000 employees. Patrick Decker, the current president of Tyco’s flow control segment, will become the new company’s chief executive officer.

Commercial Fire and Security

Tyco’s remaining commercial security business will be combined with the current fire protection segment to form a standalone commercial fire and security company. This company will be a global leader in the design, manufacture, sale, installation and service of security, fire detection and fire suppression systems. The company’s commercial security portfolio consists of video and access control products and services for commercial, industrial and governmental customers, as well as anti-theft/electronic article surveillance systems and associated services for retailers. The combined business will have annualized revenue of approximately $10 billion and approximately 69,000 employees. George Oliver, the current president of Tyco’s fire protection segment, will become the company’s chief executive officer.

Breen said the three companies will provide exciting opportunities for Tyco’s employees.

“I want to thank our outstanding employees for the extraordinary work they have done to get us to this point,” he said. “I’m confident that their talent and hard work will allow each of our three standalone businesses to reach its full potential.”

ABOUT TYCO INTERNATIONAL

Tyco International Ltd. (NYSE: TYC) is a diversified, global company that provides vital products and services to customers around the world. Tyco is a leading provider of security products and services, fire protection and detection products and services, valves and controls, and other industrial products. Tyco had 2010 revenue of $17 billion and has more than 100,000 employees worldwide. More information on Tyco can be found at http://www.tyco.com/.

Tyco International to Acquire Chemguard

Schaffhausen, Switzerland – Tyco International Ltd. (NYSE: TYC) announced that it has reached an agreement to acquire privately-held Chemguard, Inc., a leading provider of firefighting foam concentrates and equipment, foam systems, services and specialty chemicals. Chemguard will be integrated into Tyco’s Fire Protection Products business unit.
 
Founded in 1984 and based in Mansfield, TX, Chemguard is a fully-integrated provider of fire suppression products and specialty chemicals. In fire suppression, Chemguard produces an extensive line of foam concentrates as well as firefighting hardware and engineered foam systems for industrial, marine, petrochemical/energy, warehousing, forestry and airport hangar applications. The company’s specialty chemicals portfolio includes fluorosurfactant and hydrocarbon products for firefighting and other industrial applications.
 
“This acquisition will expand Tyco’s fire product and service offerings while advancing our overall strategy to increase our presence in our core security, fire and flow control platforms,” said Ed Breen, Tyco Chairman and Chief Executive Officer. “Chemguard provides an excellent strategic fit with our fire suppression business where Tyco is a world leader in protecting people and property in industrial, commercial, institutional and residential facilities.”
 
The Chemguard business consists of specialty chemical formulation, dry chemical blending and packaging, foam concentrate blending and packaging, hardware manufacturing, product testing and quality assurance. Through its acquisition of Williams Fire & Hazard Control, Inc. in 2010, Chemguard expanded its offerings to include high flow firefighting equipment and services, training and safety consulting. Williams has more than 40 years of experience in the industrial firefighting industry and is recognized worldwide for its expertise in the suppression of flammable liquid and gas fires.

“Chemguard is a respected industry leader with a talented team of professionals and a track record of developing innovative products and services to enhance fire suppression and safety,” said Colleen Repplier, President, Tyco Fire Protection Products. “This acquisition will enable us to accelerate new product development, expand our geographic presence, deepen our technical expertise and broaden our product offerings and service capabilities.” 

The transaction is expected to close in the second half of calendar 2011. The transaction is subject to customary closing conditions including clearance under the Hart Scott Rodino Act.
 
About Tyco International
 
Tyco International Ltd. (NYSE: TYC) is a diversified, global company that provides vital products and services to customers around the world. Tyco is a leading provider of security products and services, fire protection and detection products and services, valves and controls, and other industrial products. Tyco had 2010 revenue of $17 billion and has more than 100,000 employees worldwide. More information on Tyco can be found at www.tyco.com.
 
About Chemguard

Chemguard is a global, full-service, ISO 9001:2000 Certified manufacturer of fire suppression foams, equipment, and systems; specialty pumps; and fluorosurfactant specialty chemicals.  Known for advanced R&D, engineering/design expertise, quality manufacturing, and high-quality, field-tested products, Chemguard provides unmatched customer support. 

More information can be found at
http://www.chemguard.com/ and http://www.williamsfire.com.