A.O. Smith buying state in Hong Kong business

"A.O. Smith buying state in Hong Kong business | AboutHK.Com - More Information About HK"

Associated Press A.O. Smith Corp., which manufactures water-heating equipment and electric motors, said Thursday it is entering China's water treatment market, paying $77 million for a majority stake in a unit of a Hong Kong company. The Milwaukee company said it is buying an 80 percent share of the water treatment business of Tianlong Holding Co. Ltd. "One of the biggest issues facing much of the world is securing clean drinking water and Tianlong has experienced significant growth over the last several years meeting this demand," said Paul W. Jones, chairman and CEO. A.O. Smith said it will pay for the purchase from its cash flow and credit facilities. The business is expected to generate more than $100 million in sales with double-digit operating profit within three years. Within 12 months of the close of the transaction, A. O. Smith said it will introduce water treatment products in China sold under the A.O. Smith brand name.