PE-backed Unique Fabricating buys Intasco in $27.5 mln deal

Unique Fabricating Inc (NYSE: UFAB) has acquired the business and substantially all of the assets of Intasco Corp, a London, Ont.-based manufacturer of precision die cut solutions. The acquisition, valued at $27.5 million, included 100 percent of the capital stock of Intasco USA Inc. Auburn Hills, Mich.-based Unique is a maker of components for customers in the automotive and industrial appliance markets. It said the Intasco deal will broaden the company’s offerings, production capabilities, and reach in existing and adjacent markets. Unique is a portfolio investment of Taglich Private Equity, a U.S. private equity firm.

PRESS RELEASE

Unique Fabricating, Inc. Acquires Intasco

Accretive Acquisition of Precision Die Cutting Manufacturer and Leading Adhesive Solutions Provider Enhances Production Capabilities and Expands Product Portfolio for Automotive and Industrial Markets

AUBURN HILLS, Mich., May 2, 2016 /PRNewswire/ — Unique Fabricating, Inc. (“Unique” or the “Company”) (NYSE MKT: UFAB), which engineers and manufactures multi-material foam, rubber, and plastic components utilized in noise, vibration and harshness management and air/water sealing applications for the automotive and industrial appliance market, today announced it has acquired the business and substantially all of the assets of Intasco Corporation, a Canadian-based provider and manufacturer of precision die cut solutions, and purchased 100% of the outstanding capital stock of Intasco USA, Inc. (together “Intasco”).

Intasco provides cutting-edge and highly specialized adhesive products to the automotive and manufacturing industries, primarily in the United States and Canada. The company is a leader in providing material conversion of pressure-sensitive products such as film, label stock and foams, as well as adhesives and automotive die cuts with a specialty in interior and exterior attachment systems.

“This strategic, highly synergistic and accretive acquisition significantly broadens our solution offerings, production capabilities, and expands our reach in our existing markets, as well as certain adjacent, markets,” said John Weinhardt, Chief Executive Officer. “This acquisition is representative of our strategy to acquire profitable companies that add new markets, products and processes that enable us to recognize sales efficiencies and expand our scale. The specialized processes and customized nature of Intasco’s offerings provide an attractive, high-margin growth opportunity to augment our financial performance and further capitalize on the operating leverage inherent in our business model, which we believe, will enable meaningful, profitable expansion of our business and increased free cash flow.”

Intasco generated approximately $17.8 million USD in revenues, with net income of approximately $2.6 million USD and EBITDA of approximately $3.6 million USD, based on unaudited financial results for the 12 month period ending January 31, 2016.

Mr. Weinhardt added, “Intasco is a leader in precision die cutting and double-sided attachment tapes. Through this transaction we are enhancing our position as a one-stop shop for many of our current customers and creating opportunities to expand the addressable market of the Intasco business. This combination provides us with a stronger geographic presence in Canada, additional opportunities to service key customers and it helps us strengthen our competitive position in the markets we serve.”

In consideration for the acquisition, which closed on April 29, 2016, a newly formed subsidiary of the Company, Unique-Intasco Canada, Inc. (the “Canadian Buyer”), paid approximately $26.5 million CAD ($21.0 million USD) in cash at closing for the purchase of Intasco Corporation. In addition, Unique Fabricating NA, Inc. (the “US Buyer”), an existing subsidiary of the Company, purchased 100% of the outstanding capital stock of Intasco USA, Inc., for approximately $1 million CAD (approximately $790,000 USD) paid by the issuance of 70,797 shares of the Company’s common stock, par value $0.001 per share. The shares issued are “restricted shares” issued in reliance on an exemption from the registration requirements of the Securities Act of 1933, as amended. A portion of the purchase price is being held in escrow to fund the obligations of Intasco and a related party to indemnify the Canadian Buyer and US Buyer against certain claims, losses, and liabilities. The purchase price of the total Acquisition is subject to adjustment based upon Intasco’s working capital at closing.

To finance the acquisition, Unique refinanced its existing senior credit facility with Citizens Bank, including a $30 million revolving line of credit, a $17 million term loan to Unique NA, and a $15 million term loan to Unique-Intasco Canada, with Citizens serving as the syndication agent.

For additional information regarding this transaction, please refer to the Company’s Form 8-K filed with the Securities and Exchange Commission on April 29, 2016.

About Unique Fabricating, Inc.
Unique Fabricating, Inc. (NYSE MKT: UFAB) engineers and manufactures components for customers in the automotive and industrial appliance market. The Company’s solutions are comprised of multi-material foam, rubber, and plastic components and utilized in noise, vibration and harshness (NVH) management, acoustical management, water and air sealing, decorative and other functional applications. Unique leverages proprietary manufacturing processes including die cutting, thermoforming, compression molding, fusion molding and RIM injection molding of polyurethane to manufacture a wide range of products including air management products, heating ventilating and air conditioning (HVAC), seals, fender stuffers, air ducts, acoustical insulation, door water shields, gas tank pads, light gaskets, topper pads, mirror gaskets and glove box liners. The Company is headquartered in Auburn Hills, Michigan. For more information, visit http://www.uniquefab.com/.

About Intasco Corporation
Intasco Corporation provides cutting edge tape products to the automotive and manufacturing industries worldwide with facilities in London, Ontario, Canada and Port Huron, Michigan, USA. The Company’s ability to convert pressure sensitive material, tape and foam products provides its customers with the essential tools to rapidly deploy custom die-cuts and roll goods to their ever-changing environment. While Intasco is a 3M Preferred Converter, the Company also partners with other manufacturers to ensure that the final product is exactly suited to its customers’ requirements. The Company’s experienced and dedicated staff is ready to design, engineer and manufacture custom products for unique applications whether for fastening, protection, noise elimination, assembly or whatever the need may be. For more information, visit http://www.intasco.com/

Safe Harbor Statement
Except for the historical information herein, the matters discussed in this news release include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. Forward-looking statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause the Company’s or the Company’s industry’s actual results, levels of activity, performance or achievements including statements relating to the Company’s 2016 Outlook to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by this press release. Words such as “may,” “will,” “could,” “would,” “should,” “anticipate,” “predict,” “potential,” “continue,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “outlook,” and similar expressions are used to identify these forward looking statements. Such forward-looking statements include statements regarding, among other things, our expectations about revenue and earnings per share. All such forward-looking statements are based on management’s present expectations and are subject to certain factors, risks and uncertainties that may cause actual results, outcome of events, timing and performance to differ materially from those expressed or implied by such statements. These risks and uncertainties include, but are not limited to, those discussed in our Annual Report on Form 10-K, dated January 3, 2016 filed with the Securities and Exchange Commission pursuant to Rule 424(b) and in particular the Section entitled “Risk Factors” of the Annual Report on Form 10-K, as well as any updates to those risk factors filed from time to time in our periodic and current reports filed with the SEC. All statements contained in this press release are made as of the date of this press release, and Unique Fabricating does not intend to update this information, unless required by law. Reference to the Company’s website above does not constitute incorporation of any of the information thereon into this press release.

Investor Contact:
Hayden IR
Brett Maas/Rob Fink
646-536-7331/646-415-8972
ufab@haydenir.com

Photo courtesy of Unique Fabricating Inc