The stock price of Bristol-based Barnes Group jumped 15 percent Friday after the company announced it would sell its distribution business.
The company said it would sell the Barnes Distribution North America division, based near Cleveland, to MSC Industrial Direct for $550 million, allowing the Bristol company to focus its attention on manufacturing.
In a statement, company president Gregory Milzcik called the move "a highly positive transaction for both parties."
“MSC is gaining an established leader in vendor managed inventory distribution, and Barnes Group is advancing its strategic focus on differentiated manufacturing and related aftermarket services," he said. "Additionally, joining forces with MSC is an excellent opportunity for BDNA and its employees to further develop their potential as part of a company whose sole focus is distribution.”
The deal is expected to be complete by late March.
At the close of business Friday, Barnes Group stock price had risen $3.63 per share to $28.10.
The company also announced that Milzcik will step down March 1. It named Patrick Dempsey, who has been with the company for 12 years, as its next president and chief executive officer.
In addition, Barnes Group reported that its sales last year were up 16 percent and that it made a profit of nearly $30 million, up sharply from the previous year.
“Our achieved 2012 financial performance, coupled with our expectations for profitable growth in 2013, allows us to further invest in our businesses,” said Christopher J. Stephens, Jr., senior vice president, finance and chief financial officer for the company.
According to a prepared statement, Stephens said, “We believe the Company is well positioned for organic growth and to take advantage of value enhancing acquisition opportunities as they arise.”
Bristol is home to both the company's headquarters and an Associated Spring factory downtown that is part of the firm's manufacturing base.