AMETEK Warns Indicor Accounting Could Change 'Potentially Materially' After Drawing $4.0 Billion In Term Loans
The $5,154.1 million purchase price allocation is still open, and net debt-to-capital has climbed to 33.9% from 12.0% at June 30.
AMETEK, which makes electronic instruments and electromechanical devices, told investors in its quarterly report that the books on its Indicor purchase are unfinished: "All amounts could change, potentially materially." The 10-Q filed Tuesday shows the company borrowed $4.0 billion in term loans to pay for the deal while the goodwill estimate sits at $2,698.5 million.
An allocation still in flux
Of Indicor's $5,154.1 million total purchase price, AMETEK has booked $2,698.5 million to goodwill and $2,454.1 million to other intangibles. The company says the valuations are incomplete mainly because the August closing came so close to the September 30 balance sheet date.
The tax angle is also open. Some goodwill should produce an income-tax deduction, but the amount "cannot be reasonably estimated at this time," leaving the deal's cash-tax value unsettled.
Intangibles from the 2026 acquisitions are expected to be amortized at about $133 million a year for each of the next five years.
Debt quadrupled the quarter's interest bill
Total debt, net stood at $6,669.4 million on September 30, against $2,283.3 million at December 31, 2025. The net debt-to-capital ratio was 33.9%, from 14.7% at year-end. Net debt-to-capital was 12.0% at June 30, when the term loans were still undrawn.
The $4.0 billion came in three tranches: $1.625 billion due three years after funding, $1.625 billion due four years after funding and $750 million due five years after. Commercial paper outstanding totaled $306.0 million.
Third-quarter interest expense was $39.8 million, up 76.9% from $22.5 million a year earlier. AMETEK bought back $28.2 million of stock in the first nine months, compared with $163.6 million in the same period of 2025.
Record quarter around the deal
Third-quarter sales were a record $2,220.3 million, up 17.3%, and net income was a record $426.3 million, or $1.85 a diluted share. Orders hit a record $2,650.6 million, and backlog reached $4,540.5 million. The company's earnings release raised full-year adjusted earnings guidance to $8.53 to $8.57 a share, from $8.20 to $8.30.
Indicor has annual sales of about $1.1 billion. Pro forma, had the 2026 acquisitions closed at the start of the year, net sales would have been about 8% higher for the quarter and 11% higher for nine months.
The next 10-K should show whether the Indicor allocation and the deductible-goodwill figure were finalized.
Sources
- 10-Q Filing — AMETEK Inc. (AME) — SEC EDGAR
- 10-Q Filing — AMETEK Inc. (AME), Q2 FY2026 filed 2026-08-04 (comparison basis) — SEC EDGAR
- Earnings release (8-K Item 2.02, ametek8kexhibit99111032026.htm) — AMETEK Inc., filed 2026-11-03 — SEC EDGAR
