Lone Star Carves Out Carlisle Fluid Technologies

Lone Star Carves Out Carlisle Fluid Technologies

The sale of Carlisle Fluid Technologies values the company at $520 million or 9.2x adjusted EBITDA

Carlisle Fluid Technologies manufactures products and systems for the supply, application and curing of sprayed materials including paints, coatings, powders, mastics (resins) and bonding materials.

SOURCE: Carlisle Fluid Technologies

Publicly traded Carlisle Companies has agreed to sell Carlisle Fluid Technologies to Lone Star at a valuation of $520 million.

Carlisle Fluid Technologies (CFT) is a manufacturer of products and systems for the supply, application and curing of sprayed materials including paints, coatings, powders, mastics (resins) and bonding materials. Company-owned brands include BGK, Binks, DeVilbiss, Hosco, MS and Ransburg.

Source: Carlisle Fluid Technologies

Specific products of CFT include fluid handling tanks, material handling pumps, air and fluid controls, siphon and pressure spray gun cups, air and fluid hoses and connections, and a wide range of spray guns. The company’s products are used for simple finishing requirements to automated production installations in the transportation, industrial, and auto refinishing markets.

CFT is headquartered in Scottsdale, Arizona, and has a total of 600,000 sq. ft. of manufacturing facilities in the United States, the United Kingdom and Switzerland, and assembly and distribution facilities in China, Japan and South Korea.

“The sale of CFT aligns with our Vision 2025 strategy and advances our drive to construct a concentrated portfolio of construction materials businesses emphasizing a superior capital allocation approach to investments,” said Christian Koch, the chairman, president and chief executive officer of Carlisle Companies. “We believe the sale to an affiliate of Lone Star Funds is an excellent opportunity for CFT to optimize its long-term growth and profitability. I want to thank CFT’s approximately 825 global employees for contributing to CFT’s success and I thank the customers and suppliers of CFT for their continued loyalty.”

The origins of CFT date back to 1892 when Joseph Binks, a maintenance supervisor for Marshall Field’s department store in Chicago, invented the first air spray gun. His invention revolutionized the painting process by allowing for faster and more efficient application of paint. In 1893, his spray technologies were used to paint nine of ten buildings at the 1893 Columbian Exposition in Chicago. Binks Manufacturing was acquired by Illinois Tool Works in 1997 and became part of the ITW Industrial Finishing business unit. In 2019, ITW Industrial Finishing was acquired by Carlisle Companies and renamed Carlisle Fluid Technologies.

According to Carlisle Companies, its CFT segment reported $297 million in revenue in 2022 with approximately 54% of its revenues from outside the United States. In 2022, CFT had adjusted EBITDA of $56.3 million. Based on the valuation of $520 million, this equates to an adjusted EBITDA multiple of 9.2x.

Carlisle Companies (NYSE: CSL) designs, manufactures and markets a range of products for the commercial roofing, energy, agriculture, lawn and garden, mining and construction equipment, aerospace and electronics, dining and food delivery, and healthcare sectors. The company had revenues in FY2022 of $6.6 billion and is headquartered in Scottsdale, Arizona.

Dallas-headquartered Lone Star invests in private equity, credit, real estate, and other financial assets. Since raising its first fund in 1995, Lone Star has organized 22 private equity funds with aggregate capital commitments totaling over $86 billion.

Goldman Sachs was the financial advisor to Carlisle Companies on this transaction, and Guggenheim Securities and Citi advised Lone Star.

The sale of CFT is expected to close during the third quarter of 2023.

© 2023 Private Equity Professional | June 21, 2023

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