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Fox to drive off with SCA
Posted on Thursday, 13 February 2020 11:18
Fox Factory Holding is acquiring US-based speciality vehicle manufacturer SCA Performance Holdings from Southern Rocky Holdings for USD 341.00 million.
The consideration includes an upfront sum of USD 328.00 million, as well as an earnout of USD 13.00 million payable over the next two years, dependent on performance-related targets being achieved.
Completion is slated to take place in the first quarter of fiscal 2020, subject to customary closing conditions.
Fox plans to finance the transaction through cash on hand and its syndicated credit facility led by Bank of America.
As a result of the acquisition, the buyer is expected to generate annual savings of more than USD 3.00 million.
Headquartered in Alabama, SCA manufactures a range of light duty trucks and sport utility vehicles.
The group operates through three divisions, namely SCA Performance, Rocky Ridge Trucks and Rocky Mountain Truckworks.
Established in 1979, SCA has made over 120,000 custom vehicles from its 150,000 square foot manufacturing facility in Trussville.
Its offerings include brands such as Chevy, Ford, Jeep and Ram.
The deal will expand Fox’s North American geographic manufacturing footprint and broaden its product range in the automotive industry.
Furthermore, the transaction complements Fox’s existing Tuscany business and provides the company with a leading market position.
SCA will also be able to add the acquiror’s products, including lift kits and suspension components, to its vehicles.
Mike Dennison, chief executive of Fox, said: “We are excited to announce the acquisition of SCA, and believe it presents a substantial opportunity for Fox to further expand its performance-defining aftermarket solutions and continue to drive growth in our powered vehicles group.”
In the nine months following closing, the buyer expects the target to add between USD 83.00 million and USD 89.00 million in sales, as well as adjusted earnings before interest, taxes, depreciation and amortisation of between USD 22.00 million and USD 24.00 million.
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