The Timken Co. (NYSE: TKR), Canton, OH, has approved a plan to separate the company's steel business from its bearings and power transmission business through a spinoff, creating two publicly traded companies.
Under the plan, the new engineered steel company will operate as an independent publicly held company with estimated annual sales of $1.7 billion. The bearings and power transmission business will continue to operate as The Timken Co. with estimated annual sales of $3.4 billion. The transaction is expected to be completed within 12 months.
The board's decision to split Timken into two companies resulted from a thorough evaluation by a strategy committee composed of independent directors and established by the board in response to shareholder input.
Joseph W. Ralston, the board's lead independent director, said, "Through the course of our work, it became clear that creating two focused companies would allow investors to more fully appreciate and value the unique strategic and financial strengths of each business, including operating performance, margins, earnings and cash flow."