Ecolab Inc. has acquired a Michigan-based engineering firm that specializes in water recycling, paint booth management and waste treatment services for auto manufacturers such as Ford Motor Co.
The purchase of Abednego Environmental Services, which will become part of the Nalco Water business, expands Ecolab's existing water treatment operations and gives it $40 million in new annual revenue, the company said Wednesday. Terms were not disclosed.
Ecolab executives said the purchase complements its water treatment business and further diversifies the unit beyond its recently built-up oil-chemicals sector and traditional business in sanitizing chemicals for hospitals, hotels, restaurants and other entities.
Ecolab's energy-related business has struggled the past two years as global oil prices plummeted, prompting a slowdown in supply orders across that industry.
Analysts said Ecolab's expansion into nonenergy related businesses is expected to reduce the "volatility" introduced to the St. Paul company when it acquired two sizable oil-chemicals firms in 2012 and 2013.
Company officials simply said that Abednego is a good fit.
"Abednego further broadens the suite of products and services Ecolab provides to automobile manufacturers to recycle water, reduce energy usage and reduce waste," said Michael Johannsen, the Nalco Water senior vice president who oversees the manufacturing segment of Ecolab's water business.
Ecolab Chief Executive Douglas Baker noted in a statement that Abednego currently operates and manages systems in automotive plants throughout the United States.
Its key offerings include paint-booth management, engineering services and post-treatment operations.
Ecolab, with $13.5 billion in annual revenue, saw its stock rise 46 cents to close Wednesday at $118.32 a share.