March 7, 2018 / 1:18 PM / 7 months ago

UPDATE 1-Altra Industrial to buy Fortive units in $3 bln deal

(Adds details on deal, CEO comment)

March 7 (Reuters) - Altra Industrial Motion Corp said on Wednesday it would buy four units of Fortive Corp's automation & specialty business in a $3 billion deal to bolster its presence in the power transmission and motion control industry.

The deal comprises $1.4 billion in cash and debt and $1.6 billion in newly issued shares to Fortive's shareholders, the companies said in a statement.

Altra makes mechanical power transmission components used in industrial applications. Fortive's automation & specialty business makes mechanical parts such as clutches and brakes.

Structured as a Reverse Morris Trust deal, the transaction will be tax-free for shareholders.

Fortive will contribute a part of its automation and specialty business to a new wholly owned unit of Fortive which with then merge with a unit of Altra.

"With Fortive A&S, we gain exposure to industries with attractive secular growth dynamics, including the medical, robotics, factory automation and food and beverage industries," Altra Chief Executive Officer Carl Christenson said in a statement.

The deal is expected to close by end of 2018.

Goldman Sachs & Co is Altra's financial adviser, while UBS Investment Bank advised Fortive. (Reporting by Sanjana Shivdas in Bengaluru Editing by Saumyadeb Chakrabarty)

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