Morbark, a portfolio company of Stellex Capital Management since March 2016, has acquired Rayco Manufacturing.
Rayco is a maker of equipment used in the environmental, forestry, landscaping, and construction equipment sectors. Products include stump cutters, crawler trucks, forestry mulchers, multi-tool carriers, brush chippers and aerial trimmers. Rayco sells its products through an international dealer network offering equipment sales, rentals, parts, and accessories, including warranty and technical support. The company was founded in 1978 by John Bowling and is headquartered in Wooster, OH (www.raycomfg.com). Mr. Bowling will continue to have an economic interest in the combined business and is now a member of Morbark’s Board of Directors.
Morbark is a maker of equipment for the forestry, recycling, tree care, sawmill and biomass markets. The company’s products includes whole tree and waste wood chippers, flails, brush chippers, horizontal and tub grinders, sawmill equipment, and material handling systems. Morbark was founded in 1957 and operates a 1.1-million-square-foot manufacturing complex north of Lansing in Winn, MI (www.morbark.com).
“We are thrilled to welcome Rayco to the Morbark portfolio of companies,” said Dave Herr, Chief Executive Officer of Morbark. “Rayco is a company that our senior management team has admired for a long time. We value the long-standing success of Rayco and are committed to providing the Bowling family and their dedicated employees the resources they need to continue the success they have built.”
According to Stellex, the purchase of Rayco is part of its strategy to broaden Morbark’s range of tree care and industrial equipment, aftermarket parts, and services. In particular, Rayco stump cutters, aerial trimmers, forestry mulchers and crawler trucks will enhance and complement the existing Morbark product line. Rayco is the first add-on acquisition completed by Morbark under Stellex ownership.
Stellex invests from $25 million to $100 million per transaction in companies experiencing some form of financial, operational or industry-driven distress. Target companies will typically have an enterprise value of $50 million to $500 million and will be located in the United States or Europe. Sectors of interest include automotive, aerospace, building products, defense, industrial equipment, metal fabrication and transportation. Stellex Capital Management has offices in New York and London (www.stellexcapital.com).
In July 2017, Stellex closed its debut fund, Stellex Capital Partners LP, at $870 million, exceeding its $750 million target.
© 2017 Private Equity Professional | November 2, 2017
