Sun Hydraulics Corp has agreed to acquire the shares of Faster Group, a Milan, Italy-based maker of quick-release hydraulic coupling solutions, for about $531 million in cash. The seller was Capvis Equity Partners. The deal is expected to close in the second quarter of 2018. Baird was financial adviser to SNHY on the transaction.
SARASOTA, Fla.–(BUSINESS WIRE)–Sun Hydraulics Corporation (NASDAQ: SNHY) (“SNHY” or the “Company”), a global industrial technology leader that develops and manufactures solutions for both the hydraulics and electronics markets, today announced that it has entered into a definitive agreement to acquire the shares of Faster Group from Capvis Equity IV LP, a fund advised by the Swiss private equity firm Capvis Equity Partners AG, and other co-investors for €430 million (approximately $531 million) in cash. The acquisition will be funded with approximately $161 million of cash on hand and $370 million drawn against the Company’s revolving credit facility, including exercise of the revolver’s accordion. The acquisition is expected to close in the second quarter of 2018 and is subject to typical closing conditions.
Faster is a leading global manufacturer of quick-release hydraulic coupling solutions. Its primary markets include agriculture, construction equipment and general industrial applications. Headquartered in Milan, Italy, Faster has manufacturing operations co-located with its headquarters as well as in Toledo, Ohio and Pune, India. Additionally, the company has sales offices in Shanghai, China; São Paulo, Brazil; and Langenfeld, Germany.
Wolfgang Dangel, SNHY’s President and Chief Executive Officer, commented, “The acquisition of Faster is in alignment with our Vision 2025, advancing SNHY as a global technology leader in the industrial goods sector while maintaining superior profitability and financial strength. Faster further diversifies SNHY more deeply into the growing global agriculture market. The business also broadens our global footprint, advancing our ‘in the region, for the region’ initiative.”
He added, “We welcome Faster’s 475+ global employees into the SNHY family. We see a tremendous amount of synergy with both our Hydraulics and Electronics segments, including opportunities to introduce our respective products to each other’s customer bases as well as leveraging technologies and expanding utilization of existing manufacturing capacity.”
Eric Trueeb, Partner, Capvis Equity Partners AG, noted, “Capvis and the Faster management team view SNHY as the perfect candidate to acquire Faster. Given their stated Vision 2025, we believe that Faster’s continued growth and success will be enhanced under SNHY’s ownership.”
Faster recorded 2017 sales of €105 million (approximately $130 million) and an adjusted EBITDA margin of 27.5%. In 2018, the company anticipates revenue growth of 16-16.5% with an EBITDA margin in the same range as 2017. The acquisition is expected to be accretive to SNHY’s GAAP earnings in 2018 and beyond.
SNHY’s financial advisor for the transaction was Baird. Shumaker Loop & Kendrick, LLP acted as legal advisor, assisted by Pavia e Ansaldo as Italian counsel.
The Company will host a conference call and webcast tomorrow morning at 9:00 a.m. Eastern Time to review the acquisition. A question-and-answer session will follow.
The conference call can be accessed by calling (201) 689-8573. The audio webcast can be monitored at www.sunhydraulics.com. Participants will have the ability to ask questions on either the teleconference call or the webcast.
A telephonic replay will be available from 12:00 p.m. ET on the day of the call through Tuesday, February 27, 2018. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13676813. The webcast replay will be available in the investor relations section of the Company’s website at www.sunhydraulics.com, where a transcript will also be posted once available.
Sun Hydraulics Corporation is an industrial technology leader that develops and manufactures solutions for both the hydraulics and electronics markets. In the hydraulics market, the Company is a leading manufacturer of high-performance screw-in hydraulic cartridge valves, electro-hydraulics, manifolds, and integrated package solutions for the worldwide industrial and mobile hydraulics markets. In the electronics market, the Company is a global provider of innovative electronic control, display and instrumentation solutions for both recreational and off-highway vehicles, as well as stationary and power generation equipment.