Modine Manufacturing Co. announced that it is forming a new Commercial Products Group that will combine the company's Electronics Cooling and Commercial Heating, Ventilating, Air Conditioning and Refrigeration (CHVAC&R) divisions on a global basis. This new group will continue to expand the company's market presence in the electronics and HVAC markets, while taking advantage of cost reduction synergies resulting from the combination of the two businesses.
As announced in May, Modine closed its plant in Taiwan that served the personal computer and laptop markets, allowing the electronics cooling business to focus its efforts on advanced thermal solutions for other segments of the market including military, aerospace, servers and data center cooling.
David B. Rayburn, Modine President and CEO, commented, "In addition to our repositioning in the electronics market, the acquisition of Airedale International, Inc. in May of 2005, provided Modine with cooling solutions that we can now leverage in the electronics cooling space, Our Commercial Products strategy and new structure, coupled with our clearly defined strategies and product-focused customer approaches in our other groups will facilitate Modine's goal of generating improved shareholder returns over time and increasing our ROACE (return on average capital employed) to 11-12% through the cycle."
Combining these two divisions will provide integration synergies of Modine's various product lines. "One area we plan to target with greater emphasis is data center cooling. We have the expertise and supporting products to provide cooling solutions from the chip level to the building level, utilizing an integrated solution that will provide significant energy savings and other efficiencies for our customers. We can now provide a full complement of products," said Thomas G. Cromwell, Managing Director for the Commercial Products Group.
Similar to the recently announced repositioning within Modine's vehicular business, the Commercial Products Group will be organized using a product-focused approach. "Modine has a long history of innovation in the commercial heating products segment, and our product offering in electronics cooling is second to none in the industry," said James R. Rulseh, Regional Vice President - Asia, who will take executive responsibility for the Commercial Products Group. "Airedale products, added to Modine's line-up last year, are very complementary to both of these industries, so the internal business combination is a natural next step in our evolution."
