Parker to Acquire Filtration Group Corporation, Significantly Expanding Filtration Offering and Aftermarket Business

Rhea-AI Summary

Parker (NYSE:PH) agreed to acquire Filtration Group for a cash purchase price of $9.25 billion on a cash-free, debt-free basis, with expected close in 6–12 months.

Filtration Group projects CY2025 sales of $2.0 billion with an adjusted EBITDA margin of 23.5%, ~85% aftermarket sales, and ~7,500 employees. The purchase price equals 19.6x 2025 estimated adjusted EBITDA (13.4x including expected synergies).

Parker expects $220 million pre-tax cost synergies by end of year three, financing the deal with new debt and cash on hand, and says the transaction will be accretive to organic growth, synergized EBITDA margin, adjusted EPS, cash flow, and target a high single-digit cash ROIC by year five. Parker will host a webcast on Nov 11, 2025 at 8:30 AM ET.

Positive

• $2.0B expected CY2025 sales added
• Filtration Group 23.5% adjusted EBITDA margin
• 85% of Filtration Group sales are aftermarket recurring revenue
• $220M estimated pre-tax cost synergies by year three

Negative

• Purchase price of $9.25B implies 19.6x 2025 EBITDA
• Transaction expected to be financed with new debt and cash

Insights

Corporate Strategy Expert

Large-scale acquisition expands Parker into a top-tier industrial filtration franchise with heavy aftermarket exposure and clear synergy targets.

By acquiring Filtration Group for $9.25 billion, Parker folds in a business with estimated $2 billion in CY2025 sales and an adjusted EBITDA margin of 23.5%, creating one of the largest global industrial filtration platforms. The deal is structured cash‑free, debt‑free at the target level and financed with new debt and cash on hand, and the buyer cites a blended valuation of 19.6x estimated adjusted EBITDA or 13.4x including expected cost synergies.

Principal strategic strengths lie in the high aftermarket mix (approximately 85% of sales), proprietary media and engineered products that serve performance‑critical applications, and complementary market exposure across Life Sciences, HVAC/R, and industrial in‑plant channels. The announced $220 million pre‑tax cost synergies by year three and stated accretion to synergized EBITDA margin, adjusted EPS and cash flow support a narrative of margin expansion when integration executes as planned.

Key dependencies and near‑term risks include successful regulatory clearance within the stated six to twelve months closing window, efficient execution of the integration playbook ("The Win Strategy™") to realize the $220 million cost savings, and financing terms for the new debt that will fund the purchase. Watch quarterly integration milestones, reported synergy realization versus plan through year three, and the company’s disclosure on combined organic revenue trends over the first 12–24 months.

Financial Due Diligence Expert

Transaction metrics show a sizable premium but presentable post‑synergy multiples and defined profitability targets.

The purchase price of $9.25 billion implies 19.6x Filtration Group’s estimated CY2025 adjusted EBITDA and 13.4x including expected cost synergies, based on the acquirer’s math. Filtration Group’s forecasted $2 billion in CY2025 sales and an adjusted EBITDA margin of 23.5% indicate a high‑margin business with strong recurring aftermarket revenue, which supports valuation if margins hold post‑close.

Financial upside relies on delivering the announced $220 million of pre‑tax cost synergies by the end of year three and on financing the purchase price with acceptable debt terms that preserve cash flow accretion. The company states the deal will be accretive to organic growth, synergized EBITDA margin, adjusted EPS and cash flow and expects a high single‑digit cash ROIC by year five; these are contingent on integration pace and debt servicing costs.

Monitor filings and subsequent disclosures for the exact financing package, interest burden, and quarterly reports that quantify synergy capture versus plan over the next 36 months. Also track any regulatory conditions and the timing of close within the stated six to twelve months window, since delays could affect financing costs and near‑term accretion.

• Adds complementary and proprietary filtration technologies for critical applications 
• Expands presence in Life Sciences, HVAC/R, and In-Plant and Industrial market verticals
• $2 billion in expected CY2025 sales, creating one of the largest global industrial filtration businesses
• 85% aftermarket sales increases Parker Filtration aftermarket sales by 500 bps
• $220M cost synergies leveraging the power of The Win Strategy™
• Expected to be accretive to organic growth, synergized EBITDA margin, adjusted EPS and cash flow
• Parker to host conference call and webcast today at 8:30 AM Eastern Time
  

CLEVELAND, Nov. 11, 2025 (GLOBE NEWSWIRE) -- Parker Hannifin Corporation (NYSE:PH), the global leader in motion and control technologies, today announced that it has entered into a definitive agreement to acquire Filtration Group Corporation on a cash-free, debt-free basis for a cash purchase price of $9.25 billion, which represents 19.6x Filtration Group’s calendar year 2025 estimated adjusted EBITDA, or 13.4x including expected cost synergies. The purchase price is expected to be financed with new debt and cash on hand. The transaction is subject to customary closing conditions, including receipt of applicable regulatory approvals, and is expected to close within six to twelve months.

Filtration Group, a U.S. based private company and affiliate of Madison Industries, adds complementary filtration technologies serving key growth markets with strong product brands that are often validated and specified. The company’s highly engineered products use proprietary media and leverage strong technical and application knowledge and processes. Approximately 85% of sales are generated in the aftermarket, creating strong recurring revenue streams across multiple product platforms. Filtration Group has a strong organic growth profile and serves high value, performance-critical applications. Filtration Group expects calendar year 2025 sales of $2 billion with adjusted EBITDA margin of 23.5% and employs approximately 7,500 team members serving customers around the world.

“This strategic transaction continues our investment in high quality businesses that continue to transform our portfolio, accelerate sales growth and improve profitability,” said Jenny Parmentier, Parker’s Chairman of the Board and Chief Executive Officer. “The acquisition will create one of the largest global industrial filtration businesses. Filtration Group’s complementary capabilities and strong aftermarket presence enhances our ability to serve customers globally. Leveraging The Win Strategy™ as a part of our proven operations and integration playbook, we see clear opportunities to deliver strong cost synergies, compound earnings per share growth and create shareholder value.”

“Filtration Group is excited to become part of Parker,” said Jon Pratt, President and Chief Executive Officer of Filtration Group. “Together, our mission-critical offering of advanced filtration technologies will create a broader portfolio of solutions for customers in key growth markets around the world. Parker is an exceptional company, and we are confident Filtration Group will benefit from Parker’s increased scale, technical knowledge and disciplined approach to driving growth and operational excellence.”

By leveraging its business system, The Win Strategy™, Parker estimates pre-tax cost synergies of approximately $220 million by the end of year three following completion of the transaction. The transaction is expected to be accretive to Parker’s organic growth, synergized EBITDA margin, adjusted EPS, and cash flow, and to achieve a high single-digit cash ROIC by year five. 

NOTICE OF WEBCAST: Parker will host an investor conference call and webcast on the transaction via live webcast today at 8:30 a.m. Eastern time at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year.

Advisors
Barclays is serving as financial advisor, Jones Day is serving as principal deal counsel, and Eversheds Sutherland is serving as European legal counsel to Parker. Lincoln International is serving as financial advisor and Paul Hastings is serving as legal counsel to Filtration Group.

About Parker Hannifin
Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Parker has increased its annual dividend per share paid to shareholders for 69 consecutive fiscal years, among the top five longest-running dividend-increase records in the S&P 500 index. Learn more at www.parker.com or @parkerhannifin.

Note on Non-GAAP Financial Measures

This press release contains references to non-GAAP financial information of Filtration Group including adjusted EBITDA, synergized adjusted EBITDA, and adjusted EBITDA margin. A reconciliation of non-GAAP measures is included in the appendix to this press release. These measures are presented to allow investors and Parker to meaningfully evaluate net income and segment operating margins on a comparable basis. Although these measures are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating results against other periods.

Forward-Looking Statements

Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.

The risks and uncertainties in connection with such forward-looking statements related to the proposed transaction include, but are not limited to, the occurrence of any event, change or other circumstance that could delay completion of the proposed transaction; the possibility of non-consummation of the proposed transaction and termination of the merger agreement; the failure to satisfy any of the conditions to the proposed transaction set forth in the merger agreement; the possibility that a governmental entity may prohibit the consummation of the proposed transaction or may delay or refuse to grant a necessary regulatory approval in connection with the proposed transaction, or that in order for the parties to obtain any such regulatory approvals, conditions are imposed that adversely affect the anticipated benefits from the proposed transaction or cause the parties to abandon the proposed transaction; adverse effects on Parker’s common shares because of the failure to complete the proposed transaction; Parker’s business experiencing disruptions due to transaction-related uncertainty or other factors making it more difficult to maintain relationships with employees, business partners or governmental entities; the possibility that the expected synergies and value creation from the proposed transaction will not be realized or will not be realized within the expected time period; the parties being unable to successfully implement integration strategies; and significant transaction costs related to the proposed transaction.

Other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions, including the integration of Curtis Instruments, Inc.; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics.

Readers should also consider forward looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025 and other periodic filings made with the Securities and Exchange Commission.

Reconciliation of Forecasted EBITDA to Adjusted EBITDA Filtration Group

(Dollars in Millions) (Unaudited)	Forecasted 12 Months Ending 12/31/25
Net sales	$2,009
Net income	$63
Income taxes	58
Depreciation and amortization	104
Interest expense	185
EBITDA	$410
EBITDA Margin	20.5	%
Adjustments:
Business realignment charges1	18
Management company fees	21
Other non-recurring income and expenses, net2	24
Adjusted EBITDA	$473
Adjusted EBITDA Margin	23.5	%
Expected cost synergies by end of year three	220
Adjusted EBITDA, including expected cost synergies by end of year three	$693

Source: Filtration Group Corporation

1. Business realignment charges primarily includes severance related expenses
2. Other non-recurring income and expenses, net includes adjustments for gain/loss on foreign exchange, equity compensation expenses net, and other one-time events

Contact:	Media -
	Aidan Gormley - Director, Global Communications and Branding	216-896-3258
	aidan.gormley@parker.com
	Financial Analysts -
	Jeff Miller - Vice President, Investor Relations	216-896-2708
	jeffrey.miller@parker.com
Stock Symbol:	PH – NYSE

FAQ

What did Parker (PH) announce on Nov 11, 2025 regarding Filtration Group?

Parker announced it will acquire Filtration Group for $9.25 billion, expected to close in 6–12 months.

How large are Filtration Group's projected 2025 sales and margins in the Parker (PH) deal?

Filtration Group expects $2.0 billion in CY2025 sales and an adjusted EBITDA margin of 23.5%.

What synergies did Parker (PH) disclose from the Filtration Group acquisition?

Parker estimates approximately $220 million in pre-tax cost synergies by the end of year three.

Will the Filtration Group acquisition be accretive to Parker (PH) earnings?

Parker expects the transaction to be accretive to organic growth, synergized EBITDA margin, adjusted EPS, and cash flow.

How will Parker (PH) finance the $9.25B purchase of Filtration Group?

Parker expects to finance the purchase price with a combination of new debt and cash on hand.

When and where can investors hear Parker (PH) discuss the Filtration Group acquisition?

Parker will host a conference call and live webcast on Nov 11, 2025 at 8:30 AM ET at investors.parker.com, with a replay available for one year.