Wabtec to Benefit From Dellner Couplers Buyout: Here's How

Group 1: Acquisition Details - Wabtec Corporation is acquiring Dellner Couplers for $960 million in cash, financed through cash on hand and short-term debt, subject to customary closing conditions and regulatory approvals [1] - Dellner Couplers specializes in safety-critical train connection systems and services, with a global base of nearly 100,000 couplers and 12,500 gangways, serving over 200 customers across 13 countries [2] Group 2: Financial Implications - The acquisition is expected to generate immediate shareholder value, with an accretive growth profile and adjusted earnings before interest and taxes margins, along with an anticipated return on invested capital over time [3] - The purchase price represents an estimated multiple of 12.5x projected 2025 earnings before interest, taxes, depreciation, and amortization, adjusted for transaction costs and projected run-rate cost synergies of$22 million over three years [4] - Dellner Couplers is projected to generate nearly $250 million in revenues in 2025 [4] Group 3: Strategic Importance - The acquisition is a strategic move for Wabtec to enhance its portfolio of mission-critical passenger rail systems, capitalizing on the growth in the passenger rail market [5] - Wabtec's CEO highlighted that Dellner Couplers will provide significant synergies by complementing the core Transit systems portfolio and leveraging strong service capabilities, aligning with the company's growth strategies [6] Group 4: Market Performance - Wabtec currently holds a Zacks Rank 3 (Hold) and has seen its shares gain 27.9% over the past year, outperforming its transportation equipment and leasing industry and the S&P 500 [7]