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ESCO Technologies Inc. has revealed plans to sell Aclara Technologies LLC, its smart grid solutions subsidiary.

In an announcement reporting ESCO's third-quarter 2013 results, the company says it has completed the initial phase of the sale process and already received a number of formal offers. The board of directors retained Stephens Inc. as its financial advisor to assist.

ESCO says that it believes its shares trade at a price that does not fully reflect the value of its underlying assets, and it expects the potential sale of Aclara to help pay down existing debt while providing additional liquidity for acquisitions around its core businesses.

In a filing, ESCO reports that Aclara recorded a pretax loss of $17.5 million for the nine-month period ended June 30, 2013, compared to a pretax income of $6.5 million for the same period the prior year.

"The pending divestiture reflects our commitment to enhance shareholder value, as we believe now is the prudent time to explore our alternatives with respect to Aclara,” says Vic Richey, ESCO chairman and CEO. “This process will help ensure ESCO achieves its full earnings potential while creating additional shareholder value."

The company has not set a definitive timetable for the sales process but expects to have it completed within the next 90 days. However, ESCO says it does not plan to disclose or comment on developments until further disclosure is deemed appropriate or required, and there can be no assurances that the transaction will be successfully consummated.



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