Helios Technologies Completes Acquisition of Balboa Water Group
November 09 2020 - 8:30AM
Business Wire
- Balboa strategically expands Helios’s electronic controls
technology with complementary AC (alternating current)
capabilities
- Brings proprietary electronic controls technology to further
end market diversification
- State-of-the-art, low-cost manufacturing facility in Mexico
and supply chain footprint drives strong profitability
profile
- Revenue contribution from the acquisition estimated at $20M
to $22M for 2020
Helios Technologies (Nasdaq: HLIO) (“Helios” or the “Company”),
a global leader in highly engineered motion control and electronic
controls technology for diverse end markets, today announced that
it completed the acquisition of BWG Holdings I Corp. (operating as
Balboa Water Group, hereinafter “Balboa”) for $218.5 million from
investment funds affiliated with AEA Investors LP (the
“Acquisition”). The Company previously announced on October 12,
2020 that it had entered into a definitive agreement dated October
9, 2020 to acquire Balboa.
Balboa is an innovative market leader of electronic controls for
the health and wellness industry with proprietary and patented
technology that enables end-to-end electronic control systems for
therapy bath and spas. Headquartered in Costa Mesa, CA, Balboa is a
global operation selling into 47 different countries and utilizing
a new state-of-the-art manufacturing facility in Baja, Mexico.
“This is another milestone in our Company’s history, and we are
excited to welcome the Balboa team to the Helios family,” commented
Josef Matosevic, the Company’s President and Chief Executive
Officer. “Strategically, this acquisition is our first step in a
multi-year journey to build out our Electronics segment into a top
industry player. The deal aligns entirely with our Vision 2025
strategy and will have very attractive financial returns for our
shareholders from day one. Additionally, I have already received
very receptive feedback from some existing and potential new
customers around areas for product development that Helios and
Balboa will be able to create together.”
“Helios has financed the Balboa acquisition with the amended
credit agreement and existing cash of $16.2 million,” stated Tricia
Fulton, Helios’s Chief Financial Officer. “On a pro forma basis, we
expect our 2020 estimated year‐end net debt‐to‐Adjusted EBITDA
leverage ratio to be approximately 3.4x. We remain committed to a
long‐term net debt leverage target of less than 2.0x and expect to
continue to benefit from our strong cash flows to support debt
reduction and our organic growth initiatives.”
About Helios Technologies
Helios Technologies is a global leader in highly engineered
motion control and electronic controls technology for diverse end
markets, including construction, material handling, agriculture,
energy, recreational vehicles, marine, health and wellness. Helios
sells its products to customers in over 85 countries around the
world. Its strategy for growth is to be the leading provider in
niche markets, with premier products and solutions through
innovative product development and acquisition. The company has
paid a cash dividend to its shareholders every quarter since
becoming a public company in 1997. For more information please
visit: www.heliostechnologies.com.
Forward Looking Information
This news release contains “forward‐looking statements” within
the meaning of Section 21E of the Securities Exchange Act of 1934.
Forward‐looking statements involve risks and uncertainties, and
actual results may differ materially from those expressed or
implied by such statements. They include statements regarding
current expectations, estimates, forecasts, projections, our
beliefs, management’s plans, projections and objectives for future
operations, scale and performance, integration plans and expected
synergies therefrom, the timing of completion of the proposed
transaction, and assumptions made by Helios Technologies, Inc.
(“Helios” or the “Company”), its directors or its officers about
the Company and the industry in which it operates, and assumptions
made by management, and include among other items, (i) the
Company’s strategies regarding growth, including the expected
benefits of the Acquisition; (ii) the timing of completion of the
Acquisition; (iii) Company’s financing plans with respective to the
funding of the Acquisition; and; (iv) objectives for future
operations, integration plans and expected synergies. Words such as
“may,” “expects,” “projects,” “anticipates,” “intends,” “plans,”
“believes,” “seeks,” “estimates,” variations of such words, and
similar expressions are intended to identify such forward-looking
statements. Similarly, statements that describe our future plans,
objectives or goals also are forward-looking statements. These
statements are not guaranteeing future performance and are subject
to a number of risks and uncertainties. Our actual results may
differ materially from what is expressed or forecasted in such
forward-looking statements, and undue reliance should not be placed
on such statements. All forward-looking statements are made as of
the date hereof, and we undertake no obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Factors that could cause the actual results to differ materially
from what is expressed or forecasted in such forward‐looking
statements include, but are not limited to, failure to promptly and
effectively integrate the Acquisition; objectives for future
operations, integration plans and expected synergies; the ability
to recognize the anticipated benefits of the Acquisition, which may
be affected by, among other things, competition, and the ability of
the combined business to grow and manage growth profitably; failure
to promptly and effectively integrate the Acquisition; risks
related to disruption of management time from ongoing business
operations due to the Acquisition; and the ability of Helios to
retain and hire key personnel, and maintain relationships with
suppliers. Further information relating to factors that could cause
actual results to differ from those anticipated is included but not
limited to information under the heading Item 1. “Business” and
Item 1A. “Risk Factors” in the Company’s Form 10-K for the year
ended December 28, 2019 and Part II, Item IA, “Risk Factors” in the
Company’s Form 10-Q for the quarter ended March 28, 2020 and other
filings with the Securities and Exchange Commission.
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version on businesswire.com: https://www.businesswire.com/news/home/20201109005288/en/
For more information: Tania Almond Vice President,
Investor Relations & Corporate Communications (941) 362-1333
tania.almond@HLIO.com Deborah Pawlowski Kei Advisors LLC (716)
843-3908 dpawlowski@keiadvisors.com
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