On September 25, 2023, Regal Rexnord Corporation, announced it had reached a definitive agreement to sell most of its Industrial Systems segment, specifically the Industrial Motors and Generators businesses, to WEG. The sale was agreed upon for a total consideration of C$531 million (US$400 million). The finalization of this deal was subject to regulatory approvals and customary closing conditions, with an expected completion in the first half of 2024.

Louis Pinkham, the CEO of Regal Rexnord, reflected on the decision, stating that the sale aligned with their strategy of concentrating on sectors where they could achieve higher growth rates and gross margins above 35%. While acknowledging the improvements made in the growth prospects and margins of these businesses, Pinkham believed WEG was better positioned to further enhance their performance.

Pinkham also mentioned that the net proceeds from this transaction would be directed towards reducing Regal Rexnord’s debt. This action, combined with the company's anticipated strong organic cash flow, aimed to lower their net leverage ratio to below 2.5x by 2025. He expressed gratitude towards the associates at Industrial Systems for their contributions and optimism about new opportunities for them under WEG following the transaction.

Regarding the transaction's advisors, Guggenheim Securities, LLC served as the financial advisor to Regal Rexnord. Godfrey & Kahn, S.C. was the legal counsel for the deal.