Dallas private equity heavyweight Lone Star Funds is cashing out of one of its industrial crown jewels. The firm has agreed to sell Charlotte-based process-technology maker SPX FLOW to ITT Inc. in a cash-and-stock deal valuing the company at about $4.775 billion. The transaction, announced this week, would tuck SPX FLOW into ITT’s Industrial Process unit and is slated to close by the end of the first quarter of 2026. Lone Star took SPX FLOW private in 2022 and is now lining up an exit after roughly three years of ownership.
Deal terms and structure
According to Lone Star Funds, an affiliate of Lone Star Fund XI has signed a definitive agreement to sell SPX FLOW to ITT in a transaction worth $4.775 billion, paid in a mix of cash and ITT shares. The sale is subject to customary closing conditions, and Citi and Jefferies LLC are serving as financial advisors to Lone Star. The firm reiterated that it expects the deal to close by the end of the first quarter of 2026.
Financials and operations
As outlined by ITT, the consideration includes $700 million in ITT common stock, with the remainder paid in cash. The companies are targeting around $80 million in run-rate cost synergies by the end of year three following the close. ITT said SPX FLOW generated roughly $1.3 billion in revenue over the trailing twelve months and employs about 3,800 people. A significant portion of its sales comes from higher-margin aftermarket services, a line of business ITT has highlighted as a key attraction.
Why it matters for Lone Star and Dallas
The sale marks another sizable exit in a busy 2025 for the Dallas firm, which earlier in the year sold its stake in Portuguese lender Novo Banco and also agreed to buy Hillenbrand in separate large-cap moves, according to Dallas Innovates. Headquartered in Dallas with offices worldwide, Lone Star has been actively reshaping an industrial-leaning portfolio, stacking up both major acquisitions and high-profile exits.
Next steps and financing
To help finance the purchase, ITT has already gone to the capital markets. In a separate filing, the company priced an underwritten public offering expected to generate approximately $1.14 billion in net proceeds, which ITT said will fund part of the SPX FLOW acquisition. The deal still needs regulatory approvals and other standard closing sign-offs before it becomes official. The timing of cross-border approvals and lender consents will play a big role in whether the transaction hits the targeted closing by the end of the first quarter of 2026.
Background on SPX FLOW
SPX FLOW was taken private by Lone Star in April 2022 in an all-cash buyout valued at roughly $3.8 billion. The company says it operates in more than 25 countries and sells into over 140 markets. Under Lone Star’s ownership, SPX FLOW focused on strengthening its commercial organization and building up its aftermarket services business ahead of this sale.
“The sale of SPX FLOW marks the culmination of several years of hard work to streamline its portfolio and enhance the business,” Lone Star CEO Donald Quintin said in the firm’s statement. The exit adds to a string of sizable transactions that have kept Lone Star among the most active dealmakers in Dallas this year.
