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Columbus McKinnon to Combine with Kito Crosby Delivering Compelling Value Creation
CMCOColumbus McKinnon(CMCO) Prnewswire·2025-02-10 21:15

Core Viewpoint - Columbus McKinnon Corporation has announced a definitive agreement to acquire Kito Crosby Limited for 2.7billioninanall−cashtransaction,aimedatenhancingitspositionasaleadingproviderofintelligentmotionsolutionsinmaterialhandling[1][2][4].CompanyOverview−ColumbusMcKinnonisadesigner,manufacturer,andmarketerofintelligentmotionsolutions,focusingonmaterialhandlingapplications[15].−KitoCrosbyisagloballeaderinliftingsolutions,withastrongportfolioandnearly4,000employeesservingover50countries[2][16].TransactionDetails−Theacquisitionisvaluedatapproximately2.7 billion in an all-cash transaction, aimed at enhancing its position as a leading provider of intelligent motion solutions in material handling [1][2][4]. Company Overview - Columbus McKinnon is a designer, manufacturer, and marketer of intelligent motion solutions, focusing on material handling applications [15]. - Kito Crosby is a global leader in lifting solutions, with a strong portfolio and nearly 4,000 employees serving over 50 countries [2][16]. Transaction Details - The acquisition is valued at approximately 2.7 billion, with an expected closing later in the year, subject to regulatory approvals [1][4]. - The transaction is expected to create around 70millioninannualnetcostsynergies,improvingAdjustedEBITDAmarginstoover2370 million in annual net cost synergies, improving Adjusted EBITDA margins to over 23% [4][8]. - The combined company is projected to have annual revenue of 2.1 billion and Adjusted EBITDA of 486milliononapro−formabasis[8][9].StrategicRationale−TheacquisitionisseenasastrategicmovetostrengthenColumbusMcKinnon′smarketposition,leveragingfavorabletrendssuchasreshoring,infrastructureinvestment,andrisingautomationneeds[2][4].−Thecombinationisexpectedtoenhancetheproductportfolioandexpandintoattractiveverticalsandgeographies,deliveringexceptionalinnovationtocustomers[2][4].FinancialImplications−Thetransactionwillbefundedthrough486 million on a pro-forma basis [8][9]. Strategic Rationale - The acquisition is seen as a strategic move to strengthen Columbus McKinnon's market position, leveraging favorable trends such as reshoring, infrastructure investment, and rising automation needs [2][4]. - The combination is expected to enhance the product portfolio and expand into attractive verticals and geographies, delivering exceptional innovation to customers [2][4]. Financial Implications - The transaction will be funded through 2.6 billion in committed debt financing and $0.8 billion in perpetual convertible preferred equity from CD&R [4][10]. - The combined cash flow generation is anticipated to enable a reduction in the Net Leverage Ratio from approximately 4.8x to about 3.0x within two years post-closing [9][10]. Management and Governance - CD&R's investment will lead to the addition of new members to Columbus McKinnon's Board of Directors, enhancing governance and operational expertise [6][7]. - The management teams of both companies share values of safety, quality, and customer focus, which are expected to create value for all stakeholders [3][5].