GUELPH,
ON, Dec. 20, 2023 /CNW/ - Linamar Corporation
(TSX: LNR) today announced that it has reached an agreement to
acquire Bourgault Industries Ltd. of St.
Brieux, Saskatchewan, further enhancing its Industrial
segment's diversified offerings and advancing its position as a
leading short-line agriculture equipment manufacturer. Bourgault is
a world-class agriculture equipment manufacturer regarded as a
market and technology leader in broad acre seeding. Linamar's
existing agricultural brands include harvesting specialist MacDon,
and tillage and crop nutrition expert Salford. Bourgault is
highly complimentary to these existing divisions and enables
Linamar to increase its market position as it now possesses a full
lineup of products in the broader crop production cycle, from field
preparation, to seeding, crop nutrition, harvest and post
harvest.
The transaction, representing the purchase of 100% of the equity
interest of Bourgault, is for CAD $640
Million, subject to customary adjustments. Bourgault
will become part of a new Linamar Agriculture division within the
broader Industrial Segment. The industrial segment also
includes Skyjack, a manufacturer of aerial work platforms.
This new Agriculture group will continue to operate the shortline
brands of MacDon, Salford, and
Bourgault independently while maximizing overall growth
opportunities globally, better enabling future Agriculture
technologies, improving the overall farm customer experience, as
well as enhancing product support. The acquisition includes
Bourgault's Highline Manufacturing division which produces hay
handling and livestock feeding equipment, as well as roto-moulding
producer Free Form Plastics.
Linda Hasenfratz, Linamar
Executive Chair and CEO said "We are thrilled to welcome Bourgault
Industries into the Linamar family. Bourgault is another
Canadian manufacturing success story that draws many similarities
to Linamar's history of entrepreneurism and technical
innovation. The Bourgault name is synonymous with broad acre
agricultural seeding innovation and offers a tremendous opportunity
for Linamar to further diversify and grow our agriculture platform,
as well as our Industrial segment overall. It also further
enhances our powerful synergistic diversification strategy whereby
our Industrial businesses benefit from purchasing leverage, global
footprint and access to industry leading lean manufacturing
expertise from our Mobility businesses, while our Mobility business
benefits from the strong cash generation and brand expertise of our
Industrial businesses. Together our business model provides
an excellent formula for consistent, sustainable growth with strong
margins and excellent balance sheet strength."
Jim Jarrell, Linamar's President
and COO added, "Bourgault is our third strategic acquisition of
2023, following two previous transactions within the Mobility
sector earlier this year. This work is the result of a
well-defined strategy to grow our business with diversified product
offerings, creating a larger potential addressable market and new
pathways for future revenue growth. Bourgault strengthens our
short-line agriculture platform with strong brand recognition, a
portfolio of advanced seeding technologies and an operational
footprint that will enable us to better serve the core Western
Canadian and US Midwest farm base."
Bourgault President Gerry
Bourgault commented, "Bourgault was started by my father and
has a rich history in agriculture. The Bourgault family is
incredibly proud of the legacy we have created both here in in
St. Brieux, Saskatchewan, but also
around the world. We are excited to have our team of over
nine-hundred people in Saskatchewan, and over one thousand worldwide,
join the Linamar family. Linamar has a proven track record for not
only successfully integrating acquired companies, but also for
their manufacturing expertise and business execution overall.
I am confident Linamar will take the Bourgault brand to new heights
in its next chapter, while also allowing Bourgault to maintain and
build upon its deep-rooted connections to its stakeholders in
Saskatchewan and around the
world."
Linamar will hold a webcast & conference call today
Wednesday December 20 at 5:00 p.m. ET to discuss the Transaction in
greater detail. The event will be simulcast and can be accessed at
the following URL
https://events.q4inc.com/attendee/553482801. The webcast can
also be navigated to via the Company's website. For those who wish
to listen to an audio only call-in option, the numbers for this
call are (+1) 888 259 6580 (North
America) or (+1) 416 764 8624 (International) Conference ID
75145440, with a call-in required 15 minutes prior to the start of
the webcast. The conference call will be chaired by Ms. Hasenfratz.
The webcast replay will be available at
https://events.q4inc.com/attendee/553482801 after the call.
A taped replay of the conference call will also be made
available Linamar Corporation starting at 8:00 p.m. ET on December
20, 2023, for seven days. The number for the replay is (+1)
(877) 674-7070 or (+1) (416) 764-8692, Passcode: 145440 #. In
addition, a recording of the call will be posted at
https://www.linamar.com/event/linamar-bil-acquisition/
The transaction is subject to customary regulatory approvals and
expected to close in Q1 2024. A new term loan facility
will fund the acquisition under similar terms and conditions as
Linamar's existing revolving credit facility. The term loan
will mature in three years to closely align to the maturing of
Linamar's existing revolving credit facility. This term loan
agreement has been fully underwritten by commitments of BMO Capital
Markets, TD, Scotiabank, and National Bank.
TD Securities are acting as financial advisors to Linamar in
connection with the Transaction. Aird & Berlis LLP was retained
as legal counsel for Linamar. KPMG Corporate Finance are acting as
financial advisors to Bourgault in connection with the transaction.
McDougall Gauley LLP is retained as legal counsel for
Bourgault.
Linamar Corporation (TSX:LNR) is an advanced manufacturing
company where the intersection of leading-edge technology and deep
manufacturing expertise is creating solutions that power vehicles,
motion, work and lives for the future. The Company is made up of
two operating segments – the Industrial segment and the Mobility
segment, both global leaders in manufacturing solutions and
world-class developers of highly engineered products. The
Industrial segment is comprised of Skyjack, MacDon and Salford. Skyjack manufactures scissor, boom
and telehandler lifts for the aerial work platform industry. MacDon
manufactures combine draper headers and self-propelled windrowers
for the agricultural harvesting industry. Salford also supplies the agriculture market
with farm tillage and crop fertilizer applicator equipment. The
Mobility segment is focused on propulsion systems, structural and
chassis systems, energy storage and power generation for both the
global electrified and traditionally powered vehicle markets, and
is subdivided into three regional groups and one global product
group: North America, Europe, Asia
Pacific and the newly formed Structures Group. The Regional
Mobility groups are vertically integrated operations combining
expertise in light metal casting, forging, machining and assembly.
The Linamar Structures Group offers competitive lightweight
innovations for safety-critical components and systems for the
global mobility market. In addition, the eLIN Product Solutions
Group focuses on Electrification and McLaren Engineering provides
design, development, and testing services for the Mobility segment.
Linamar's medical solutions group, Linamar MedTech, focuses on
manufacturing solutions for medical devices and precision medical
components. Linamar has over 31,000 employees in 70 manufacturing
locations, 14 R&D centres and 28 sales offices in 19 countries
in North and South America,
Europe and Asia, which generated sales of more than
$7.9 billion in 2022. For more
information about Linamar Corporation and its industry-leading
products and services, visit www.linamar.com or follow us on our
social media channels.
Guelph, Ontario
December 20, 2023
SOURCE Linamar Corporation
