Pentair to acquire water valve maker Hydra-Stop for $290 million

LONDON - Pentair plc (NYSE:PNR), a $17.2 billion market cap water solutions company with a strong financial health rating according to InvestingPro, announced Monday it has entered into a definitive agreement to acquire Hydra-Stop LLC, a specialty valve solutions provider, for approximately $290 million in cash from Madison Industries.

The net transaction value is approximately $240 million after accounting for expected tax benefits of around $50 million, according to a press release statement from the water solutions company. With a healthy current ratio of 1.45 and moderate debt levels, Pentair appears well-positioned to finance this acquisition.

Illinois-based Hydra-Stop manufactures insertion valves and line stop equipment that allow water utilities to repair specific sections of water pipes without shutting down larger portions of water systems. The company employs more than 50 team members and generates approximately 99% of its sales in the United States.

Hydra-Stop is expected to generate approximately $50 million in revenue for full year 2025 with a Return on Sales of approximately 30%.

"This strategic acquisition will help accelerate our growth initiatives for our commercial and infrastructure business by supporting municipalities and their service providers in addressing critical water issues," said De’Mon Wiggins, Executive Vice President and President of Pentair Flow.

Upon completion, Hydra-Stop will operate within Pentair’s Commercial and Infrastructure business unit of its Flow business segment. The acquisition is expected to close by the end of 2025, subject to customary closing conditions and regulatory approvals.

Pentair, which had revenue of approximately $4.1 billion in 2024, provides water solutions for residential, commercial, and industrial applications. The company employs approximately 9,750 people globally and serves customers in more than 150 countries. With a 50-year track record of consistent dividend payments and strong return on equity of 17%, Pentair has demonstrated remarkable stability and growth potential. For detailed analysis and additional insights, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 top US stocks.

In other recent news, Pentair reported second-quarter 2025 earnings that surpassed analyst expectations, leading to an increase in full-year guidance. Despite the strong performance, the company’s shares experienced a slight dip in pre-market trading due to mixed guidance. Analysts have reacted to these developments with varying opinions. Stifel reiterated its Buy rating on Pentair, maintaining a price target of $125, citing the company’s robust quarterly results. Mizuho also expressed confidence by raising its price target from $118 to $122 while maintaining an Outperform rating, highlighting the company’s solid performance across all metrics. In contrast, TD Cowen downgraded Pentair from Buy to Hold, lowering its price target to $110 due to concerns about the company’s growth outlook and the delayed recovery of end markets. These recent developments reflect a mix of optimism and caution among analysts regarding Pentair’s future prospects.

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