ITT buys Godwin Pumps for $585 million

An update from the print version: Godwin Pumps has about 250 employees in Bridgeport, N.J.

When I hear the name ITT Corp., I immediately think of the sprawling conglomerate that it once was.

But like the former many-tentacled Tyco International Ltd., ITT is not what it was before 1995, when it split into three companies: a hospitality company, the Hartford insurance company, and a collection of manufacturing companies that now bears the ITT name.

Some ingrained habits, such as acquisitions, die hard, though. White Plains, N.Y.-based ITT has shelled out $3 billion on acquisitions over the last five years, according to Bloomberg News.

On Monday, ITT announced its latest, buying privately held Godwin Pumps of America Inc., of Bridgeport, N.J., for $585 million.

Started in 1976, Godwin Pumps manufactures, sells, and rents portable equipment used to pump water and other fluids by the construction, municipal, and other markets. ITT already has its own “dewatering” business, and the acquisition of Godwin Pumps is expected to double the revenue it generates.

Godwin Pumps had 2009 revenue of about $200 million, and 2010 revenue is projected to be $235 million. ITT estimates the global market for dewatering pumps and rental services to be $3 billion. Based on an estimated $465 million in combined revenue, that would give ITT a 15 percent share of the worldwide market.

In a statement, ITT said Godwin Pumps has about 800 employees throughout the United States and at its factory in Gloucestershire, England. For years, the Gloucester County Office of Economic Development has listed Godwin Pumps among the county’s 10 largest private-sector employers. A county survey from earlier this year listed its workforce as 640 people.

Once the transaction is completed during the third quarter, Godwin Pumps will become part of ITT’s $1.6 billion Water & Wastewater business unit, which is based in Stockholm, Sweden. Total revenue for ITT in 2009 was $10.9 billion.

Janney Montgomery Scott analyst James C. Lucas wrote in a note to investors that ITT paid about 8 to 9 times earnings before interest, taxes, depreciation and amortization to scoop up Godwin Pumps.

Not bad for a company that began as an outgrowth of the Paz Brothers Construction Co. in the 1970s. The late John Paz Sr. started Godwin Pumps, importing the equipment from a similarly named manufacturer in England for use on U.S. construction sites.

Current CEO John Michael Paz joined his father’s business shortly after he graduated from Dickinson College in 1978 with a bachelor’s degree in economics. The younger Paz became president in 1985 and expanded its rental business. Today, the company has a rental fleet of more than 6,000 pumps through 26 branch offices.

In 2001, Paz engineered Godwin Pumps’ acquisition of the British manufacturer that his father had launched into business with in 1976.

Janney Montgomery’s Lucas said the acquisition by ITT “makes sense.” He noted about 89 percent of Godwin’s sales are in the United States, while ITT has a wide distribution network in Europe and Asia.

Shares of ITT closed Monday at $48.44, down 9 cents, or 0.2 percent.