CPE

MILWAUKEE – October 29, 2026 -- A. O. Smith (NYSE: AOS) reported third-quarter 2026 sales of $941 million, net earnings of $126 million and diluted EPS of $0.93, while moving to sell 81% of its China business to alternative asset manager CPE and cutting China from its full-year outlook.

China sale values the unit at about $400 million before royalties

The definitive agreements, announced October 27, value the China business at approximately $400 million on a cash-free, debt-free basis, excluding the long-term brand licensing royalty stream. Including the net present value of licensing payments over a multi-decade period, total value is expected to exceed $500 million.

MILWAUKEE – October 29, 2026 -- A. O. Smith Corporation (NYSE: AOS) agreed to sell an 81% interest in its China business to alternative asset manager CPE, valuing the unit at approximately $400 million on a cash-free, debt-free basis. The company will keep a 19% stake and sign a long-term brand licensing agreement.

Licensing royalties lift total deal value above $500 million

The $400 million valuation excludes the royalty stream from the brand license. Including the net present value of licensing payments to A. O. Smith over a multi-decade period, total value is expected to exceed $500 million.

The structure also lets A. O. Smith repatriate roughly $80 million in cash now held in China.

Share repurchases take priority for after-tax proceeds

After closing, A. O. Smith intends to prioritize share buybacks as the use of after-tax proceeds and repatriated cash.