Pentair plc has entered into a definitive agreement to acquire Taco Group Holdings for approximately $1.425 billion, subject to customary adjustments and closing conditions. The acquisition is designed to expand Pentair’s water-solutions portfolio and strengthen its presence across HVAC, commercial buildings, industrial applications and data-center infrastructure.
Pentair expects Taco to generate approximately $540 million in revenue in 2026. The company also expects the acquisition to provide approximately $30 million in annual run-rate cost synergies and contribute to adjusted earnings per share following the closing.
The transaction is currently pending, with Pentair expecting the acquisition to close in the fourth quarter of 2026, subject to customary conditions and regulatory approvals.
Deal Snapshot
| Deal Detail | Information |
| Acquirer Company | Pentair plc |
| Target Company | Taco Group Holdings |
| Deal Type | Acquisition |
| Announcement Date | July 28, 2026 |
| Purchase Price | Approximately $1.425 billion |
| Industry | Water Solutions / Water & Fluid Management |
| Expected 2026 Taco Revenue | Approximately $540 million |
| Expected EBITDA Margin | Above 20%, including expected run-rate synergies |
| Valuation | Approximately 10.5× 2026E EBITDA |
| Expected Cost Synergies | Approximately $30 million annually |
| Expected Closing | Q4 2026 |
| Pentair Business Segment | Water Solutions |
| Taco Brand | Expected to continue |
| Taco Headquarters | Cranston, Rhode Island, U.S. |
| Pentair Country | USA |
| Pentair Stock Exchange | New York Stock Exchange |
| Pentair Ticker | PNR |
| Deal Status | Pending / Expected to Close Q4 2026 |
Pentair Company Introduction
Pentair plc is a global water-solutions company that develops products and technologies for residential, commercial and industrial water applications.
The company operates across areas including water movement, water treatment and pool solutions. Pentair serves customers in more than 150 countries and has approximately 9,000 employees.
Pentair reported approximately $4.2 billion in revenue in 2025, and its shares trade on the New York Stock Exchange under the ticker PNR.
The company has organized its operations around three major areas:
- Flow – solutions for moving and managing water and other fluids
- Water Solutions – water treatment and related residential and commercial solutions
- Pool – equipment and solutions for swimming pools
Following the Taco transaction, Pentair plans to include Taco within its Water Solutions segment.
Taco Group Holdings Company Introduction
Taco Group Holdings is the parent company of Taco Comfort Solutions, a manufacturer of hydronic and water-based equipment.
Taco was founded in 1920 and is headquartered in Cranston, Rhode Island, United States. The company develops products used in HVAC, plumbing, residential, commercial and industrial applications.
Its portfolio includes products such as:
- Pumps
- Valves
- Tanks
- Heat exchangers
- Hydronic equipment
- Advanced controls
Taco’s products are used to move and manage water in heating and cooling systems. The company has operations and customers across North America, Europe and Asia.
What Is Pentair Acquiring?
Under the definitive agreement, Pentair will acquire Taco Group Holdings’ outstanding equity securities for approximately $1.425 billion, subject to customary adjustments.
This means the transaction is a full acquisition rather than a minority investment or simple partnership.
After completion, Taco will become part of Pentair’s Water Solutions segment while the Taco brand is expected to continue operating in the market.
Why Is Pentair Acquiring Taco?
The acquisition gives Pentair access to Taco’s technology, products, customer relationships and distribution network.
Taco’s products are particularly relevant to markets where water circulation and thermal management are important, including HVAC systems and commercial buildings.
Pentair expects the combination to provide opportunities to expand its product portfolio and reach additional customers.
Expansion in the HVAC Market
One of the important areas for the acquisition is the HVAC market.
HVAC stands for heating, ventilation and air conditioning.
Taco develops hydronic products that use water or other fluids to transfer heating or cooling energy through a building.
For example, pumps and valves can help circulate water through a building’s heating or cooling system.
By acquiring Taco, Pentair can add these products and technologies to its existing water-solutions portfolio.
Data Center Opportunity
Another important part of the transaction is the potential opportunity in data-center infrastructure.
Modern data centers require large amounts of cooling because servers and computing equipment generate significant heat.
As AI computing and cloud infrastructure expand, cooling systems have become an increasingly important part of data-center construction and operation.
Taco’s hydronic and water-management technologies can be used in cooling and building systems, giving Pentair additional exposure to this market.
However, this should be viewed as a strategic growth opportunity rather than a guarantee of future data-center revenue.
Taco’s Pumps, Valves and Controls Complement Pentair’s Portfolio
Taco has a range of products that complement Pentair’s existing water-solutions businesses.
Its portfolio includes:
- Pumps
- Valves
- Tanks
- Heat exchangers
- Controls
- Hydronic systems
These products can work together with water-management and treatment technologies already offered by Pentair.
The combined portfolio could allow Pentair to provide a broader range of solutions to commercial and industrial customers.
Taco’s Expected Revenue
Pentair expects Taco to generate approximately $540 million of revenue in 2026.
Pentair also expects Taco’s EBITDA margin to be above 20%, including expected run-rate cost synergies.
It is important to note that the $540 million figure is a 2026 estimate, rather than Taco’s completed full-year financial result.
Expected Cost Synergies
Pentair expects approximately $30 million in annual run-rate cost synergies from the acquisition.
Cost synergies mean that the combined company may be able to reduce certain expenses after the businesses are integrated.
Potential areas include:
- Supply-chain efficiencies
- Purchasing efficiencies
- Operational improvements
- Elimination of overlapping costs
The $30 million figure is an expected run-rate benefit and is not a guaranteed financial result.
Revenue Synergy and Cross-Selling Opportunity
The transaction could also create opportunities to sell Taco products through Pentair’s existing commercial network.
Pentair and Taco have different customer and distribution relationships. Combining these networks could create opportunities to introduce products to additional:
- Distributors
- Contractors
- OEMs
- Engineers
- Building owners
- Industrial customers
This is generally referred to as a revenue synergy, because the combined company may generate additional sales by using the capabilities of both businesses.
Taco’s Installed Product Base
Another potential benefit is Taco’s existing installed base.
Many pumps, valves and other HVAC-related products remain in buildings for years. Over time, these products may require replacement, maintenance or upgrades.
This creates an aftermarket opportunity for replacement products and related services.
Pentair has highlighted Taco’s installed base as one of the opportunities associated with the acquisition.
How Will Pentair Finance the Acquisition?
Pentair plans to use a combination of cash on hand and financing to fund the transaction.
On September 1, 2026, Pentair and its subsidiaries entered into a new credit agreement that included:
- $400 million senior unsecured Tranche 1 term loan
- $1.0 billion senior unsecured Tranche 2 term loan
The total term-loan financing available under these facilities was $1.4 billion.
According to Pentair’s SEC filing, the loans were intended to support the Taco acquisition and related financing requirements, with funding expected around the transaction’s closing, subject to applicable conditions.
Potential Impact on Pentair’s Debt
The acquisition will increase Pentair’s debt compared with its position before the transaction.
Pentair reported approximately $1.606 billion of total debt as of June 30, 2026.
The company expects its net leverage ratio to be approximately 2.4× following the acquisition and has stated a goal of reducing it to below 1.5× within two years.
This is Pentair’s stated target and depends on future financial performance, cash generation and other factors.
Expected Impact on Earnings
Pentair expects the Taco acquisition to contribute approximately $0.10 to $0.15 of adjusted EPS accretion in fiscal 2027.
In simple terms, EPS accretion means Pentair expects the acquisition to increase its adjusted earnings per share after the transaction is completed and integrated.
This is a forward-looking estimate and actual results could differ.
What Will Happen to the Taco Brand?
Pentair does not currently plan to eliminate the Taco brand.
Following the acquisition, Taco is expected to become part of Pentair’s Water Solutions segment while continuing to operate under the Taco brand.
Pentair has also indicated that Taco will maintain a significant presence in Cranston, Rhode Island.
This allows Pentair to acquire Taco’s technology and customer relationships while retaining an established brand with a long operating history.
Key Risks Associated With the Deal
Although Pentair expects several strategic and financial benefits, the acquisition also carries risks.
Pentair’s SEC filings identify potential risks including:
- Delays in completing the acquisition
- Regulatory approval requirements
- Difficulty integrating Taco’s operations
- Employee and customer retention
- Failure to achieve expected synergies
- Higher debt following the acquisition
- Higher interest and financing costs
- Potential unexpected liabilities or integration expenses
Therefore, expected synergies and EPS accretion should be treated as management projections rather than guaranteed outcomes.
What This Deal Means in Simple Terms
In simple terms, Pentair is spending approximately $1.425 billion to acquire Taco Group Holdings and bring Taco’s pumps, valves, hydronic systems and controls into its water-solutions business.
The deal can potentially strengthen Pentair’s presence across:
Water Solutions + HVAC + Commercial Buildings + Industrial Applications + Data-Center Infrastructure
Pentair expects Taco to contribute approximately $540 million of 2026 revenue, while the combined company is expected to benefit from approximately $30 million in annual run-rate cost synergies.
The acquisition is also expected to contribute to Pentair’s adjusted EPS in fiscal 2027.
However, the deal remains pending, and its final financial impact will depend on the closing of the transaction, integration and the actual performance of the combined businesses.
Source: Investor-pantair, SEC
