July 7, 2023 10:53 AM | 1 min read
Valmont Industries Inc (NYSE:VMI) has entered into a definitive agreement to acquire HR Products, a wholesale supplier of irrigation parts in Australia, for an undisclosed sum.
The acquisition will expand the company’s geographic footprint and grow its parts presence in a key agriculture market.
HR Products provides a broad range of irrigation products to serve the agriculture and landscaping industries. It has nearly 100 employees and six warehouse facilities.
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The company expects the deal to be immediately accretive to earnings, with Year 1 revenue of about $45 million.
The transaction is expected to close in the third quarter of 2023.
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“Due to the long life cycle of irrigation equipment, there is a substantial market to replace wearable parts,” said Joshua Dixon, President of Global Irrigation.
“This acquisition positions us very well to meet this demand, leveraging our existing Valley® dealer network for distribution and service, and large installed machine base in the region to grow recurring, high-value revenue streams and help lessen the cyclicality in our agriculture business.”
Valmont plans to fund the transaction with cash on hand. It held $172.9 million in cash and equivalents as of April 1, 2023.
Price Action: VMI shares are trading higher by 1.25% at $286.53 on the last check Friday.
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