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ESCO Announces Divestiture of VACCO Industries

1. ESCO to sell VACCO Industries to RBC Bearings for $310 million. 2. Transaction supports ESCO's focus on high-growth end-markets. 3. Gross cash proceeds will be used to reduce Maritime acquisition debt. 4. CEO expresses confidence in VACCO's future under RBC Bearings. 5. Divestiture aligns with ESCO's long-term strategic review.

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FAQ

Why Bullish?

This transaction can strengthen ESCO’s financial stability by reducing debt, similar to past benefits seen in similar divestitures like Honeywell's sale of its Aerospace division, which positively impacted its stock price.

How important is it?

The sale of a key subsidiary can significantly impact ESCO’s future prospects and financial health.

Why Long Term?

The focused strategy on core markets and reduced debt are likely to have sustained positive effects over time, akin to General Electric's refocusing efforts on more profitable segments.

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RBCHONGE
St. Louis, May 20, 2025 (GLOBE NEWSWIRE) -- ESCO Technologies Inc. (NYSE: ESE) (ESCO, or the Company) today announced that it has entered into a definitive agreement to sell VACCO Industries (VACCO) to RBC Bearings Incorporated (NYSE: RBC), an international manufacturer and marketer of highly engineered precision bearings and products, headquartered in Oxford, Connecticut. The Company expects to finalize the transaction upon receipt of certain customary regulatory approvals with expected gross cash proceeds of $310 million subject to typical post-closing adjustments. A sizable book gain is expected on the transaction, with a plan to use the net proceeds for paying down debt incurred in connection with the Maritime acquisition. Last August, the Company announced a strategic review of the VACCO business and the resulting divestiture supports ESCO’s long-term strategy to focus its portfolio on core high-growth end-markets. VACCO has been a part of ESCO since its formation in 1990 and is a key supplier of highly-technical mission-critical solutions. Bryan Sayler, Chief Executive Officer and President, commented, “We view this transaction as a great outcome for all and are confident that VACCO and its dedicated management team and employees are positioned for a positive future with RBC Bearings.” ESCO was represented by Philpott, Ball & Werner, LLC as exclusive financial advisor and Bryan Cave Leighton Paisner LLP as legal advisor on this transaction. ESCO Technologies is a global provider of highly engineered products and solutions serving diverse end-markets. It manufactures filtration and fluid control products, advanced composites, as well as signature and power management solutions for aviation, Navy, space, and industrial customers. ESCO is an industry leader in designing and manufacturing RF test and measurement products and systems; and provides diagnostic instruments, software and services to industrial power users and the electric utility and renewable energy industries. Headquartered in St. Louis, Missouri, ESCO and its subsidiaries have offices and manufacturing facilities worldwide. For more information on ESCO and its subsidiaries, visit ESCO’s website at www.escotechnologies.com. SOURCE ESCO Technologies Inc.Kate Lowrey, Vice President of Investor Relations, (314) 213-7277

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