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Hillenbrand, Inc. HI announced that it has completed the previously announced sale of its majority interest in the Milacron injection molding and extrusion business (or Milacron) to Bain Capital for $287 million. This move aligns with Hillenbrand's ongoing portfolio transformation efforts to boost its overall margins by focusing on less cyclical and higher growth opportunities.
The Milacron injection molding and extrusion business came under Hillenbrand’s portfolio following its acquisition of Milacron Holdings Corp. in 2019. The deal also included Mold-Masters, DME and Cimcool. The company sold the Cimcool business in 2020 but continues to retain ownership of the Mold-Masters and DME businesses.
Milacron fell under Hillenbrand’s Molding Technology Solutions segment. In fiscal 2024, Milacron contributed $526 million in revenues and $64 million in adjusted EBITDA.
Following a strategic portfolio review, Hillenbrand announced its intention to sell the majority stake in Milacron on Feb. 5, 2025. With the completion of the sale, Bain Capital now owns approximately 51% of Milacron and has full operational control, while Hillenbrand retains the remaining 49% stake. With this arrangement, Bain Capital will focus its resources on growing Milacron, with Hillenbrand retaining the scope to reap future returns from Milacron. The company also stated that it will use the net proceeds after tax of approximately $250 million to repay its debt, following customary closing adjustments.
On Feb. 5, Hillenbrand updated the fiscal 2025 outlook for remaining businesses to reflect the sale. Revenues for fiscal 2025 are now projected at $2.625 - $2.790 billion compared with the prior estimate of $2.925 - $3.090 billion. The Advanced Process Solutions segment’s revenues are projected at $2.05 - $2.175 billion and the Molding Technology Solutions segment’s revenues are estimated at $575 - $615 million.
Total adjusted EBITDA is expected between $411 million and $447 million and adjusted earnings per share are anticipated in the band of $2.45 - $2.80.
In the past year, Hillenbrand’s shares have lost 50.5% compared with the industry’s fall of 11.4%.
Hillenbrand currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the Industrial Products sector are Mueller Water Products MWA, Applied Industrial Technologies AIT and AZZ AZZ. MWA currently sports a Zacks Rank #1 (Strong Buy), while AIT and AZZ each have a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Mueller Water Products’ fiscal 2025 earnings is pegged at $1.25 per share, implying year-over-year growth of 29.2%. MWA delivered a trailing four-quarter average earnings surprise of 39.7%. Mueller Water Products’ shares have gained 65% in a year.
Applied Industrial Technologies delivered an average trailing four-quarter earnings surprise of 5.3%. The Zacks Consensus Estimate for Applied Industrial Technologies’ 2025 earnings is pinned at $9.90 per share, which indicates year-over-year growth of 1.5%. AIT shares have gained 17.5% in a year.
AZZ delivered an average trailing four-quarter earnings surprise of 15.20%. The Zacks Consensus Estimate for AZZ’s fiscal 2025 earnings is currently pegged at $5.12 per share, which indicates year-over-year growth of 13%. AZZ shares have gained 8.7% in a year.
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This article originally published on Zacks Investment Research (zacks.com).
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