Ferronordic AB (OM:FNM) completed the acquisition of Rudd Equipment Company, Inc. for $95 million.
November 29, 2023
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Ferronordic AB (publ) (OM:FNM) entered into an agreement to acquire Rudd Equipment Company, Inc. for $95 million on November 13, 2023. The purchase price amounts to $95 million, corresponding to 5.8 x 2022 IFRS-adjusted earnings before tax. Based on the expected net debt at closing, the expected enterprise value amounts to $113 million. Ferronordic will also acquire two real properties in Cincinnati and Louisville, currently rented by Rudd from its owner. The price for the properties is $10 million. The total price for the stock in Rudd and the two properties amounts to $105 million. Out of this amount, $60 million will be financed with own cash/equity and $45 million with new bank debt. Ferronordic has received a commitment letter from Nordea for a three-year $45 million term loan facility for the acquisition, as well as a $35 million working capital facility. After closing, Rudd will be a wholly owned subsidiary of Ferronordic AB and will be integrated into Ferronordic?s general corporate governance and internal controls. In 2022, Rudd had sales of $308.3 million with an operating income of $16.5 million and earnings before tax of $16.4 million (both adjusted to IFRS). All consents and approvals for the transaction have been obtained, including the approval of Volvo CE. Thus, all conditions for the transaction have been satisfied. The transaction will be completed on 30 November 2023. The transaction is not expected to have any direct impact on Ferronordic?s business in Germany and Kazakhstan.
Ferronordic AB (publ) (OM:FNM) completed the acquisition of Rudd Equipment Company, Inc. on November 30, 2023.
Ferronordic AB is a Sweden-based company engaged in sales and distribution of construction equipment. It operates as an authorized dealer of Volvo Construction Equipment, Renault trucks and Volvo CE. Additionally, it distributes Volvo and Renault Trucks, Volvo Penta, among others. Through its business segment, Equipment Distribution, the Company offers sale and rental of new and used machines and other equipment, contracting services, as well as aftermarket support (sales of parts and service). The Company distributes excavators, backhoe loaders, dump trucks, pipelayers, forestry machines, bulldozers and gensets. The Company provides its services to other companies in the Quarries and aggregates, mining, road construction, transport and logistic and general construction industries