Plumbing and Mechanical

A.O. Smith To Buy GSW

March 7, 2006
A.O. Smith Corp. reached agreement with GSW's two majority shareholders on A.O. Smith's proposed acquisition of Canadian-based GSW, parent company of American Water Heaters. The parties have agreed to a purchase price of $115 (Canadian) per share for the shares owned by the majority shareholders, subject to A.O. Smith completing its remaining due diligence and negotiating formal lock-up agreements with the majority shareholders and a support agreement with GSW on terms satisfactory to both companies.

GSW's water heating segment manufactures and markets water heaters sold in the United States and Canada through its American Water Heater Co. and GSW Water Heater subsidiaries.

The purchase will leave the water heater industry with only three U.S. players in the tank storage segment of the market - A.O. Smith, Rheem and Bradford White.