SEGUIN, Texas, Sept. 11, 2019 /PRNewswire/ -- Alamo Group
Inc. (NYSE: ALG) announced that it has entered into an agreement to
acquire 100% of the outstanding capital shares of Morbark, LLC, a
leading manufacturer of equipment and aftermarket parts for
forestry, tree maintenance, biomass, land management and recycling
markets. These products are marketed under the Morbark,
Rayco, Denis Cimaf and Boxer Equipment brand names. The
company's annual sales were $225.5
million in 2018 and the company had trailing twelve month
sales of $233 million as of the end
of July, 2019. Total consideration for the purchase is
approximately $352 million subject to
certain adjustments. The acquisition, which is expected to
close in the fourth quarter of 2019, is subject to a number of
conditions, including the receipt of regulatory approvals and other
pre-closing requirements.
Morbark was founded in 1957 and is based in Winn, Michigan with subsidiary operations in
Wooster, Ohio and Roxton Falls,
Quebec. The company has approximately 720 employees. Their
products include a broad range of tree chippers, grinders, flails
and debarkers along with stump grinders, mulchers and brush cutters
plus related aftermarket spare and wear parts. The company is
privately held and primarily owned by Stellex Capital
Partners. The president of Morbark is Dave Herr and he will continue in this role upon
completion of the transaction when the company will become a part
of Alamo's Industrial Division led
by Jeff Leonard.
Ron Robinson, Alamo Group's
President and Chief Executive Officer commented, "We are very
pleased with the prospect of having Morbark join the Alamo
Group. Morbark is a well- run, profitable, and growing
company in a sector that has been steadily improving. Their
products expand and complement our range of vegetation maintenance
equipment in an adjacent market. We are excited about the
opportunities this acquisition will provide Alamo and we look to continue their existing
strategic growth plan focused on product development and market
expansion, supplemented with synergistic acquisitions.
We also believe this acquisition will allow us to accelerate
Morbark's international growth plans with Alamo's existing presence in areas such
as Europe as well as select
markets such as Brazil and
Australia. We believe the two companies will jointly benefit
from various operational synergies as well. This combination
will provide both a strategic fit and scale of operations that
should benefit Alamo for the long
term."
In preparation for this closing, Alamo is working with its banking group to
amend and expand its current credit facilities to accommodate this
acquisition and meet the ongoing needs of the combined
entities.
About Alamo Group
Alamo Group is a leader in the design, manufacture, distribution
and service of high quality equipment for infrastructure
maintenance, agriculture and other applications. Our products
include truck and tractor mounted mowing and other vegetation
maintenance equipment, street sweepers, snow removal equipment,
excavators, vacuum trucks, other industrial equipment, agricultural
implements and related after-market parts and services. The
Company, founded in 1969, has approximately 3,650 employees and
operates 29 plants in North
America, Europe,
Australia and Brazil as of June
30, 2019. The corporate offices of Alamo Group Inc.
are located in Seguin, Texas and
the headquarters for the Company's European operations are located
in Salford Priors, England.
Forward Looking Statements
This release contains forward-looking statements that are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. The words "anticipate,"
"preliminary," "expect," "believes," and similar expressions
identify forward looking statements. These statements reflect
Alamo's current beliefs and are
based on information currently available to it.
Forward-looking statements involve known and unknown risks and
uncertainties, which may cause the Company's actual results,
performance or achievements to differ materially from those
expressed or implied by such statements. Among those factors which
could cause actual results to differ materially are the following:
market demand, competition, weather, seasonality, currency-related
issues, acquisition integration risks, and other risk factors
listed from time to time in the Company's SEC reports. The Company
does not undertake any obligation to update the information
contained herein, which speaks only as of this date.
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SOURCE Alamo Group Inc.