SPX Technologies: Our Take on FIS Water Acquisition

SPX's acquisition of FIS Water supports its strategic push to deepen and broaden the Cooling platform, adding a highly-engineered water management and control niche that sits directly within SPX's own cooling systems. The core rationale here is that water in commercial and industrial cooling, particularly around cooling towers, is critically important, since poor water quality and solids can severely damage equipment, while FIS's filtration and separation portfolio maintains water quality, protects equipment and extends asset life. SPX views this as an attractive engineered niche, carrying low-30s% segment margins and HSD growth, both above HVAC segment average. The valve and actuator content also complements the recently acquired Neptronic business, advancing SPX's move into higher-margin, controls-enabled HVAC. Financially, the ~12x net of tax annualized EV/EBITDA multiple sits at the upper end of the 8-12x range typical of SPX's acquisition targets, but is defensible given the growt