Kadant to Acquire Key Knife, Inc.
December 28 2023 - 4:16PM
Kadant Inc. (NYSE: KAI) has entered into a definitive agreement to
acquire Key Knife, Inc. and certain of its affiliates (“Key Knife”)
for approximately $156 million in cash, subject to certain
customary adjustments. The acquisition is expected to close in
early January 2024, subject to the satisfaction of customary
closing conditions, and will be financed primarily through
borrowings under Kadant’s revolving credit facility.
Founded in 1986, Key Knife is a global supplier of
engineered knife systems for custom chipping, planing, and flaking
solutions for wood product industries. Its products enable wood
processing mills to improve fiber recovery, product quality, and
maximize production while lowering operating costs. The company is
headquartered in Tualatin, Oregon with 141 employees located
primarily in the United States and Canada. Key Knife’s revenue for
the trailing twelve months ended September 30, 2023 was
approximately $65 million. Key Knife will become part of Kadant’s
Industrial Processing reporting segment.
“We have known and worked with Key Knife for over
20 years, and they are an excellent fit with Kadant,” said Jeffrey
L. Powell, president and chief executive officer of Kadant. “With
its strong aftermarket business and focus on providing highly
engineered knife systems, Key Knife will broaden our product
portfolio and strengthen our position in wood processing
industries. We look forward to welcoming the employees of Key Knife
to the Kadant family.”
Christopher W. McDonald, president and chief
executive officer of Key Knife, commented, “We are proud of the
strong brand Key Knife has built. As a process industry leader with
a culture and values similar to ours, we believe Kadant is a great
home for our company and employees, and we are excited for the
opportunities to grow as a part of Kadant.”
About Kadant Kadant
Inc. is a global supplier of technologies and engineered systems
that drive Sustainable Industrial Processing. The Company’s
products and services play an integral role in enhancing
efficiency, optimizing energy utilization, and maximizing
productivity in process industries. Kadant is based in Westford,
Massachusetts, with approximately 3,100 employees in 20 countries
worldwide. For more information, visit www.kadant.com.
Safe Harbor Statement
The following constitutes a “Safe Harbor” statement under the
Private Securities Litigation Reform Act of 1995: This press
release contains forward-looking statements that involve a number
of risks and uncertainties, including forward-looking statements
about the financial and operating performance of Key Knife, the
benefits of the proposed acquisition of Key Knife (the
“Acquisition”), the probable timing and financing of the
Acquisition, and the expected future business and financial
performance of Key Knife and Kadant. These forward-looking
statements represent our expectations as of the date of this press
release. We undertake no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise. These forward-looking statements are
subject to known and unknown risks and uncertainties that may cause
our actual results to differ materially from these forward-looking
statements as a result of various important factors, including
those set forth under the heading "Risk Factors" in Kadant’s annual
report on Form 10-K for the fiscal year ended December 31, 2022 and
subsequent filings with the Securities and Exchange Commission.
These include risks and uncertainties relating to the ability to
consummate the Acquisition; the ability to obtain financing to
complete the Acquisition; Kadant's ability to successfully
integrate Key Knife and its operations and employees and realize
anticipated benefits from the Acquisition; unanticipated
disruptions to the business, general and regional economic
conditions, and the future performance of Key Knife; the risk that
the conditions to the closing of the Acquisition are not satisfied;
potential adverse reactions or changes to business or employee
relationships, including those resulting from the announcement or
completion of the Acquisition; uncertainties as to the timing of
the Acquisition; competitive, investor or customer responses to the
Acquisition; the ability to realize anticipated synergies and cost
savings; unexpected costs, charges or expenses resulting from the
Acquisition; adverse changes in global and local economic
conditions; the variability and difficulty in accurately predicting
revenues from large capital equipment and systems projects; health
epidemics and pandemics; our acquisition strategy; levels of
residential construction activity; reductions by our wood
processing customers of their capital spending or production of
oriented strand board; changes to the global timber supply;
development and use of digital media; cyclical economic conditions
affecting the global mining industry; demand for coal, including
economic and environmental risks associated with coal; failure of
our information systems or breaches of data security and
cybertheft; implementation of our internal growth strategy; supply
chain constraints, inflationary pressure, price increases and
shortages in raw materials; competition; changes in our tax
provision or exposure to additional tax liabilities; our ability to
successfully manage our manufacturing operations; disruption in
production; future restructurings; loss of key personnel and
effective succession planning; protection of intellectual property;
climate change; adequacy of our insurance coverage; global
operations; policies of the Chinese government; the variability and
uncertainties in sales of capital equipment in China; currency
fluctuations; changes to government regulations and policies around
the world; compliance with government regulations and policies and
compliance with laws; environmental laws and regulations;
environmental, health and safety laws and regulations impacting the
mining industry; our debt obligations; restrictions in our credit
agreement and note purchase agreement; soundness of financial
institutions; fluctuations in our share price; and anti-takeover
provisions.
ContactsInvestor Contact
Information:Michael McKenney, 978-776-2000IR@kadant.comorMedia
Contact Information:Wes Martz, 269-278-1715media@kadant.com
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