Héroux-Devtek Announces Agreement to Acquire Beaver Aerospace and Defense U.S. Manufacturer of Ball Screws and Actuation Sys...
February 27 2018 - 7:00AM
Héroux-Devtek Inc. (TSX:HRX) (“Héroux-Devtek” or the
“Corporation”), a leading international manufacturer of aerospace
products, is pleased to announce an agreement to acquire the shares
of Beaver Aerospace & Defense Inc. and its wholly-owned
subsidiary PowerTHRU Inc. (“Beaver”), from Phillips Service
Industries Inc., for a purchase price of approximately US$23.5
million, including a US$2.5 million balance of sale payable over
two years following closing. The transaction is expected to close
in the next 90 days, subject to customary closing adjustments and
certain regulatory approvals. The transaction will be financed
through the Corporation’s existing revolving credit facility. Given
the strong cash generation of Héroux-Devtek year-to-date, the
financial leverage ratios (as of March 31st 2018) presented with
the CESA acquisition on October 2nd 2017, would not increase as a
result of the closing of the transaction. Beaver generates annual
revenues of approximately US$30 million, of which about two thirds
are derived from the defense sector.
“This acquisition will allow us to broaden our
existing aerospace product offering into ball screws and actuation
systems and will enlarge our footprint in North America, while
being complementary with Héroux-Devtek and CESA’s businesses. In
addition, we plan to leverage Beaver’s relationships with industry
leading OEMs and suppliers in the ball screws and actuation
business in order to facilitate our penetration of this market
particularly in the U.S. We will also benefit from cross-selling
opportunities and operational efficiencies. Beaver has
committed management and employees and we are looking forward to
having them join us”, commented Héroux-Devtek President & CEO,
Gilles Labbé.
Founded in 1952, Beaver is a vertically
integrated manufacturer with a growing portfolio of
company-designed products. It designs and manufactures custom ball
screws from a variety of materials based on customer and
application requirements as well as designs, manufactures,
assembles and tests electromechanical actuators. Beaver operates
three facilities totalling 82,200 square feet in Livonia, Michigan
and employs approximately 100 people.
On October 2nd 2017, Héroux-Devtek announced an
agreement to acquire Compañia Española de Sistemas Aeronauticos,
S.A. (“CESA”), a subsidiary of Airbus SE (PA: AIR), headquartered
in Madrid, Spain. The closing is expected to occur around the
Corporation’s 2018 fiscal year end, subject to certain approvals,
including the authorization of the Spanish Council of Ministers and
the prior acquisition by Airbus of the stake of its minority
partner in CESA.
National Bank Financial Markets acted as
exclusive financial advisor to Héroux-Devtek.
CONFERENCE CALL AND PRESENTATION |
Tuesday, February 27, 2018 at 10:30 AM, Eastern
time |
Dial-in number: |
647-788-4922 (Toronto and overseas
participants) |
1-877-223-4471 (all other North American
calls) |
A presentation is also available at
www.herouxdevtek.com |
|
Please dial-in 15 minutes before the conference call begins. If you
are unable to call-in at this time, you may access a recording of
the meeting by calling 1-800-585-8367 and entering the passcode
9374428 on your phone. This recording will be available on Tuesday,
February 27, 2018 as of 1:30 PM until 11:59 PM on Tuesday, March 6,
2018. Interested parties may also listen live at
www.herouxdevtek.com. A copy of the investor presentation will also
be available on the Corporation’s website at
www.herouxdevtek.com. |
FORWARD-LOOKING STATEMENTS
Except for historical information provided herein, this press
release contains information and statements of a forward-looking
nature concerning the future performance of the Corporation.
Forward looking statements are based on assumptions and
uncertainties as well as on management's best possible evaluation
of future events. Such factors may include, without excluding other
considerations, fluctuations in quarterly results, evolution in
customer demand for the Corporation's products and services, the
impact of price pressures exerted by competitors, and general
market trends or economic changes. As a result, readers are
advised that actual results may differ from expected results.
Please see the Guidance section in the Corporation’s MD&A for
the quarter ended December 31st, 2017, for further details
regarding the material assumptions underlying the forecasts and
guidance. Such forecasts and guidance are provided for the purpose
of assisting the reader in understanding the Corporation’s
financial performance and prospects and to present management’s
assessment of future plans and operations, and the reader is
cautioned that such statements may not be appropriate for other
purposes.
PROFILEHéroux-Devtek Inc.
(TSX:HRX) is an international company specializing in the design,
development, manufacture and repair and overhaul of landing gear
and actuation systems and components for the Aerospace market. The
Corporation is the third largest landing gear company worldwide,
supplying both the commercial and defence sectors of the Aerospace
market with new landing gear systems and components, as well as
aftermarket products and services. The Corporation also
manufactures hydraulic systems, fluid filtration systems and
electronic enclosures. Approximately 90% of the Corporation's sales
are outside Canada, including about 65% in the United States. The
Corporation's head office is located in Longueuil, Québec with
facilities in the Greater Montreal area (Longueuil, Laval and
St-Hubert); Kitchener, Cambridge and Toronto, Ontario; Springfield
and Strongsville, Ohio; Wichita, Kansas; Everett, Washington; and
Runcorn, Nottingham and Bolton, United Kingdom.
From:Héroux-Devtek Inc.Gilles LabbéPresident
and Chief Executive OfficerTel.: (450) 679-3330
Contact:MaisonBrisonPierre BoucherTel.: (514)
731-0000
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