ELKHART,
Ind., Jan. 11, 2024 /PRNewswire/ -- Patrick
Industries, Inc. (NASDAQ: PATK) ("Patrick" or the "Company"), a
leading component solutions provider for the Outdoor Enthusiast and
Housing markets, today announced that it has signed a definitive
agreement to acquire Sportech, LLC ("Sportech") for approximately
$315 million. The transaction is
expected to close on or before January 24,
2024, and is subject to customary closing conditions and
regulatory approval.
Sportech, based in Elk
River, Minnesota, is a leading designer and manufacturer of
high-value, complex component solutions to powersports OEMs,
adjacent market OEMs and the aftermarket, including integrated door
systems, roofs, canopies, bumpers, windshields, fender flares and
cowls. With a focus on supplying premium components to the
powersports industry, particularly the attractive utility vehicle
segment of the market, Sportech recorded estimated calendar year
2023 revenue of approximately $255
million, resulting in a five-year compound annual growth
rate of 17%. The acquisition is expected to be immediately
accretive to profit margins and net income per share.
"We are delighted to welcome Sportech's Chief Executive Officer,
Jim Glomstad, and the entire
Sportech team to the Patrick family," said Andy Nemeth, Chief Executive Officer of Patrick.
"Sportech's long history of passion-driven innovation, profitable
growth, and excellent customer service, along with its strong
culture, is a great fit with our Outdoor Enthusiast vision and
brand-forward go-to-market strategy. Sportech provides meaningful
scale as a supplier of key and synergistic solutions to powersports
OEMs, many of which Patrick has established relationships with
through our RV, marine, and existing powersports businesses.
Sportech offers a solid platform for future organic and strategic
growth within the powersports market, enabling us to continue to
accelerate our momentum in the attractive Outdoor Enthusiast space,
where we have industry-leading platforms in the RV and marine
markets and see a clear pathway to revenue and cost synergies. We
look forward to supporting Sportech's team as they continue to
focus on what they do best."
Jim Glomstad commented, "The team
at Sportech and I are excited to join the Patrick family of
incredible brands and leverage their foundation of resources and
support as we continue to implement our strategy to 'Discover,
Design, Develop and Deliver' for our valued customers. We are
confident we can continue to build on our current relationships and
expand the portfolio of products and solutions we offer in
partnership with our OEM customers while increasing our market
share and becoming a valued contributor to Patrick's vision for its
Outdoor Enthusiast ecosystem."
Acquisition Highlights
- Patrick, through a wholly owned subsidiary, will acquire all
outstanding equity of Sportech, LLC, for $315 million. The all-cash transaction will be
funded with a combination of borrowings under the Company's
existing credit facility and cash on hand.
- The acquisition of Sportech is expected to be immediately
accretive to profit margins and net income per share.
- The transaction is expected to close on or before January 24, 2024, subject to customary closing
conditions, including regulatory approval.
- Proforma net leverage ratio (as calculated in accordance with
our credit agreement) at closing is expected to approximate 2.9x,
with the Company focusing on reducing its net leverage ratio to
pre-acquisition levels within the next two to three quarters.
- Following closing, Sportech will continue its operations as a
wholly owned subsidiary of Patrick under the Sportech name and
within its existing facilities.
Conference Call Webcast
Patrick Industries will host a conference call on Thursday, January 11, 2024 at 8:30 a.m. Eastern Time to discuss the
acquisition. Participants on the call will be Andy Nemeth, Chief Executive Officer,
Kip Ellis, Chief Operating Officer,
and Matt Filer, Interim Chief
Financial Officer. In addition, a video which will be presented
during the call and a supplemental investor presentation can both
be accessed on the Company's website, www.patrickind.com under "For
Investors."
Participation in the question-and-answer session of the call
will be limited to institutional investors and analysts. The
dial-in number for the live conference call is (877) 407-9036.
Interested parties are invited to listen to a live webcast of the
call on Patrick's website at www.patrickind.com under "For
Investors." A replay of the conference call and the related video
will also be available via the Company's investor relations
website.
About Sportech, LLC
Sportech designs, manufactures, and assembles cab components and
systems for the powersports, golf and turf, industrial, and
agricultural end markets. Sportech's design and engineering
capabilities allow the company to provide complex components and
assemblies to its original equipment manufacturer customers.
Sportech is based in Elk River,
Minnesota.
About Patrick Industries, Inc.
Patrick Industries (NASDAQ: PATK) is a leading component
solutions provider for the RV, Marine, Powersports and Housing
markets. Founded in 1959, Patrick is based in Elkhart, Indiana, employing approximately
10,000 team members throughout the United
States.
Forward-Looking Statements
This press release contains certain statements related to future
results, our intentions, beliefs and expectations or predictions
for the future, which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of 1995.
Any projections of financial performance or statements concerning
expectations as to future developments should not be construed in
any manner as a guarantee that such results or developments will,
in fact, occur. There can be no assurance that any forward-looking
statement will be realized or that actual results will not be
significantly different from that set forth in such forward-looking
statement. Information about certain risks that could affect our
business and cause actual results to differ from those expressed or
implied in the forward-looking statements are contained in the
section entitled "Risk Factors" in the Company's Annual Report on
Form 10-K for the year ended December 31,
2022, and in the Company's Forms 10-Q for subsequent
quarterly periods, which are filed with the Securities and Exchange
Commission ("SEC") and are available on the SEC's website at
www.sec.gov. Each forward-looking statement speaks only as of the
date of this press release, and we undertake no obligation to
update any forward-looking statement to reflect events or
circumstances occurring after the date on which it is made.
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SOURCE Patrick Industries, Inc.