Atkore Inc., an electrical products manufacturer based in Harvey, Illinois, has sold its high-density polyethylene pipe and conduit business to Infra Pipes, a North American specialist in polyethylene pipeline solutions. The company will contribute $28 million in capital to the buyer and hold a 10% equity interest in the resulting entity, while anticipating tax benefits from the deal. This move sharpens Atkore's focus on core electrical infrastructure for commercial, industrial, data center, and solar markets amid a portfolio review.
Transaction Mechanics and Financial Terms
Atkore's divestiture transfers its HDPE operations—used in utility and infrastructure applications—to Infra Pipes, recognized by CEO Bill Waltz as a market leader suited to advance that segment. Citi acted as exclusive financial advisor, with Debevoise & Plimpton LLP handling legal counsel. Atkore, which carries a $2.15 billion market capitalization, positions the sale as accretive to adjusted EBITDA margins and return on invested capital, currently at 7% with analysts forecasting profitability this year.
Strategic Shift Toward Electrical Core
The sale aligns with Atkore's disciplined portfolio management, allowing deeper investment in electrical raceways, fittings, and conduits essential for data centers and renewable energy projects. HDPE products, while complementary, diverge from this electrical emphasis, prompting the separation to enhance operational efficiency. With $2.9 billion in fiscal 2025 sales and 5,400 employees, Atkore gains flexibility to pursue high-growth areas like solar and data infrastructure.
Strong Recent Performance Bolsters Outlook
Atkore's first-quarter fiscal 2026 results underscore the timing of this refocus, with earnings per share of $0.83 beating estimates of $0.64 and revenue of $655.5 million topping $650.09 million forecasts. This first earnings beat in two years stemmed from higher volumes, pricing power, and margin expansion. RBC Capital subsequently lifted its price target from $64 to $71, holding a Sector Perform rating, as InvestingPro metrics suggest the stock trades undervalued relative to fair value.
