US-based trailer builder, Wabash National, has announced that it has entered into a definitive agreement to acquire all of the outstanding shares of fellow US truck body manufacturer, Supreme.
According to Wabash, Supreme primarily manufactures light- and medium-duty truck bodies at seven facilities throughout the US, with 2016 sales of $299 million (€254.7 million)
The acquisition is a cash tender offer for US$21 (€17.9) per share, which represents an equity value of US$364 million and an enterprise value of US$342 million (€291.4 million).
“Wabash National has been closely monitoring the transportation landscape as the growth of e-commerce has continued to change the logistics model,” said Dick Giromini, Wabash National’s Chief Executive Officer.
“We formally entered the final mile space in 2015 with the launch of our dry and refrigerated truck bodies, and we have been aggressively growing our presence and product offering over the past two years. This acquisition supports these efforts and accelerates our objective to transform our business into a more diversified industrial manufacturer.”
The acquisition will reportedly combine Supreme’s extensive medium- and light-duty commercial vehicle portfolio, distribution network, and regional manufacturing locations with Wabash National’s advanced composite technologies, expertise in lean manufacturing and optimisation, engineering and design proficiency and strong supplier relationships.
“This is a great opportunity for both companies to combine our strengths to provide an enhanced customer experience within the growing final mile delivery space,” Giromini said.
“With Supreme, not only can Wabash National accelerate organic growth with our innovative DuraPlate, honeycomb panel and molded structural composite (MSC) truck bodies, we can also provide a broader conventional product offering to our existing customer base.”
Supreme Industries’ Chief Executive Officer, Mark Weber, commented, “This is an exciting day for Supreme. Combining with Wabash will enhance our ability to innovate more quickly and create more value for customers. We found a cultural fit with Wabash National. Because of its commitment to safety, innovation and customer relationships, I’m confident joining the Wabash National family will benefit our employees, customers and distributors.”
Under the terms of the agreement and plan of merger, Wabash has formed an acquisition subsidiary, Redhawk Acquisition Corporation, that will commence a tender offer. Following the completion of the tender offer, Wabash expects to consummate a merger of Redhawk and Supreme.
The closing of the acquisition is expected to occur no later than the fourth quarter of 2017 and the transaction is not subject to any financing condition.
Wabash has obtained committed bridge financing from Morgan Stanley Senior Funding, Inc. and Wells Fargo Bank. The purchase price is expected to be funded by a combination of notes and cash.