Purchase Hurts Profit
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LAGUNA NIGUEL — Toro Co. said Tuesday that it has completed its acquisition of the irrigation-equipment unit of James Hardie Industries Ltd. in Laguna Niguel, but the transaction is taking a toll on earnings.
Bloomington, Minn.-based Toro said its acquisition of James Hardie Irrigation Group will reduce fiscal 1997 earnings per share by 5% to 7%, or as much as 22 cents a share below analysts’ average estimate. Analysts had expected the maker of consumer and commercial lawn care equipment to earn about $3.19 a share in the year ending next October.
The Hardie irrigation unit, which makes irrigation systems for the commercial landscape market, had revenue of $140 million last year. It has approximately 1,100 full-time and temporary employees in facilities in California, Texas, Florida, Australia and Europe.
Toro said the acquisition, designed to broaden its line of lawn, golf course and crop watering products, will be financed with temporary bank debt.
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