Regal Beloit Acquires CMG Engineering Group Pty

Regal Beloit Corporation has acquired CMG Engineering Group Pty. Ltd. headquartered in Melbourne, Australia.

CMG manufactures and distributes fractional horse power industrial motors, blower systems, and industrial metal products with operations in Australia, New Zealand, South Africa, Malaysia, Singapore, the United Kingdom, and the Middle East. Also included is CMG's Technology center and certified motor and drive testing facilities located in Australia. The business also distributes integral horsepower industrial motors, mechanical power transmission products, material handling equipment, electrical insulating materials, magnet wire, and specialty conductors in Australia and New Zealand.

The purchase price was approximately $75.0 million in cash, the assumption of approximately $5.5 million in net liabilities and one hundred thousand shares of Regal Beloit Common Stock.

The business is expected to add approximately $92.0 million to sales and add $.04 to diluted earnings per share in 2010. The Company's guidance includes the estimated impact of transaction costs, purchase accounting and intangible amortization based on the preliminary purchase price allocation. Sales for CMG in 2011 are expected to be approximately $128.0 to $135.5 million and the addition to diluted earnings per share are expected to be $.12 to $.15 for the business, including the dilutive impact of additional shares issued.

According to Henry W. Knueppel, Chairman and CEO of Regal Beloit, "We are very excited to announce the acquisition of CMG. The CMG business is a strong and growing business across the Asia-Pacific Region, South Africa, and the Middle East. This acquisition further expands the infrastructure necessary to significantly expand our commercial efforts in these critical regions. The company has an outstanding management team that has continuously grown the business at a multiple of market growth rates. Given this track record and the opportunities that RBC can bring to CMG, we are very confident that we will see accelerated growth. We have for some time searched for a commercial infrastructure in these important geographical regions that would allow us to leverage our global manufacturing platform. The combination of CMG and Regal Beloit's Asia Pacific operations creates both a leading commercial and manufacturing footprint and an opportunity to take advantage of significant synergies between the organizations. CMG is a perfect fit to further complete this portion of our globalization strategy."

Jack Gringlas, Group Managing Director and Owner of CMG Engineering Group stated, "I am confident that we have found the ideal acquirer for our business. RBC will provide the best platform to secure the future of the CMG business and its team of experienced and dedicated staff. I will be continuing with CMG in the role of Group Managing Director. I am extremely excited about the future of CMG as a result of this sale."