- Creates a global leader for aftermarket parts supply with a
comprehensive product offering across vehicle control and thermal
control products
- Expands SMP's portfolio of powertrain-neutral product
categories
- Purchase price of $388 million
represents approximately 7.5x EBITDA multiple inclusive of
estimated run-rate cost synergies
- Will be immediately and meaningfully accretive in the
first full year of the transaction
- $8-12M in estimated run-rate cost synergies within
24 months, with additional opportunity for meaningful revenue
synergies
NEW YORK, July 10, 2024 /PRNewswire/ -- Standard Motor
Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer
and distributor, announced it has reached a definitive agreement to
acquire AX V Nissens III APS ("Nissens"), a leading European
manufacturer and distributor of aftermarket engine cooling and air
conditioning products with a growing array of vehicle control
technologies, for approximately $388
million (€360 million) in cash from Nordic private equity
firm Axcel and the Nissen family. Nissens has annual revenues of
approximately $260 million with a
mid-teens EBITDA margin rate.
Mr. Eric Sills, Standard Motor
Products' Chairman and CEO, stated, "We are delighted to announce
this acquisition, which will make our combined business the
aftermarket leader in North
America and Europe in
thermal management products. It will also expand SMP's portfolio of
powertrain-neutral product categories.
"We plan to continue operating Nissens as a stand-alone unit,
while leveraging the combined strength of the two companies to
realize both cost and revenue synergies.
"Founded in 1921, Nissens has a long history of being an
aftermarket leader in Europe, with
market-leading brand recognition and a reputation as a
high-performing supplier of premium products. Led by Klavs Pedersen, Nissens' strong management team
has demonstrated its ability to grow and thrive during challenging
times. They enjoy deep market knowledge with well-established
customer relationships and an operational infrastructure that has
allowed them to penetrate all corners of the continent and
beyond.
"We believe the combination with SMP is a powerful one. Both
companies have a similar go-to-market strategy of supplying
full-line professional grade product offerings, and enjoy
complementary product portfolios. Meanwhile, the two companies
largely operate in different geographic markets. As such, we
believe that we are stronger together, capitalizing on synergies in
both markets and strengthening our position in each. Together, we
can accelerate growth through cross-selling our product offerings,
realize cost reduction through combined resources, and achieve
enhanced operational excellence though collaboration and best
practices.
"Lastly, we believe that as two 100+ year old companies we have
compatible business cultures and will work very well together. We
welcome all of the Nissens employees to the SMP family."
Mr. Klavs Pedersen, Nissens'
Chief Executive Officer, stated, "We are very excited to have SMP
as our new owner. We have been following SMP's activities in the
US, and we see a lot of similarities in the way SMP and Nissens
operate in their respective focus regions. I have personally known
the SMP management team for several years, and I believe there is a
very strong cultural fit that will support and accelerate the
positive development of both companies. We look forward to becoming
part of the SMP family."
Transaction Details
The transaction values Nissens at
approximately $388 million,
representing approximately 7.5x Adjusted EBITDA after factoring
estimated run-rate cost synergies at the mid-point of $10 million. The transaction is expected to be
accretive to SMP's GAAP EPS in the first full year.
The transaction is expected to be completed in the second half
of 2024, and is subject to certain closing conditions, including
receipt of applicable antitrust and other regulatory approvals.
Transaction Conference Call Information
Standard Motor
Products, Inc. will host a conference call at 11:00 AM, Eastern Time, on Wednesday, July 10, 2024 to discuss the
acquisition of Nissens Automotive. This call will be webcast and
can be accessed on the Investor Relations page of our website at
www.smpcorp.com and clicking on the SMP Investor Call Webcast link.
Investors may also listen to the call by dialing 800-225-9448
(domestic) or 203-518-9708 (international). Our playback will be
made available for dial in immediately following the call. For
those choosing to listen to the replay by webcast, the link should
be active on our website within 24 hours after the call. The
playback number is 888-562-0904(domestic) or 402-220-7346
(international). A copy of our presentation materials can be found
at SMP Investor Presentation
Advisors
J.P. Morgan Securities LLC is acting as
financial advisor, Hughes Hubbard & Reed LLP is
acting as lead transaction counsel and Plesner
Advokatpartnerselskab is acting as lead European counsel to
Standard Motor Products. J.P. Morgan Bank N.A., Bank of America and
Wells Fargo are providing committed financing for the funding of
the transaction.
About Standard Motor Products
Standard Motor Products
is the leading manufacturer and distributor of premium replacement
parts in the automotive aftermarket and a custom-engineered
solutions provider to vehicle and equipment manufacturers in
diverse non-aftermarket end markets. Its automotive aftermarket
business is comprised of two segments, Vehicle Control and
Temperature Control, while its Engineered Solutions Segment offers
a broad array of conventional and future-oriented technologies in
markets for commercial and light vehicles, construction,
agriculture, power sports, and others.
About Nissens Automotive
Nissens is the leading
European supplier of thermal management and engine efficiency
products fully focused on servicing the resilient and steadily
growing independent automotive aftermarket. The Company operates
with a distinct multi-brand strategy with offerings to passenger
car as well as commercial vehicle applications. Nissens is
headquartered in Horsens, Denmark
and was founded in 1921.
Under the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, Standard Motor Products cautions
investors that any forward-looking statements made by the company,
including those that may be made in this press release, are based
on management's expectations at the time they are made, but they
are subject to risks and uncertainties that may cause actual
results, events or performance to differ materially from those
contemplated by such forward-looking statements. Among the factors
that could cause actual results, events or performance to differ
materially from those risks and uncertainties discussed in this
press release are those detailed from time-to-time in prior press
releases and in the company's filings with the Securities and
Exchange Commission, including the company's annual report on Form
10-K and quarterly reports on Form 10-Q. By making these
forward-looking statements, Standard Motor Products undertakes no
obligation or intention to update these statements after the date
of this release.
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