Audax Private Equity has sold CURT Group, a manufacturer and distributor of towing equipment for cars and trucks, to Lippert Components, a subsidiary of publicly traded LCI Industries. The purchase price for CURT was $340 million and the EBITDA valuation multiple for this transaction appears below.
CURT is a designer, manufacturer, marketer and distributor of towing equipment and other vehicle accessory products including hitches, towing electricals, ball mounts, and cargo management systems.
Company-owned brand names include CURT, Aries, Luverne, Retrac, and UWS. CURT’s products are sold through installer, distributor, e-commerce, retail, and auto dealer channels. For the 12-month period through September 2019, CURT had revenues of approximately $255 million and an adjusted EBITDA of $35 million. This calculates to a 9.7x valuation multiple.
Eau Claire, Wisconsin-based CURT, led by CEO Rock Lambert, has more than 1,000 employees worldwide, with manufacturing plants in Wisconsin, South Dakota and Florida, and 11 regional warehouses across the United States and Canada.
Audax acquired CURT in March 2014 from Pfingsten Partners. During its ownership term, Audax completed six add-on acquisitions which grew its towing accessories business and expanded the company into aftermarket truck accessories. The largest of the six add-ons included Aries Automotive, a Torrance, California-based designer, manufacturer and distributor of aftermarket truck accessories (acquired in June 2014); United Welding Services (UWS), a Perry, Florida-based manufacturer of truck toolboxes and other truck accessories (March 2016); ProTek (a wholly-owned subsidiary of UWS), a Philippines-based manufacturer of truck toolboxes and other truck accessories (March 2016); and Luverne Truck Equipment, a Brandon, South Dakota-based manufacturer of truck accessories including front-end protection, side steps, splash guards, and mirrors (February 2016).
“We are incredibly proud to have partnered with Rock Lambert and the CURT team,” said Jay Mitchell, a managing director at Audax. “Through organic and acquisition growth the company has expanded its product portfolio and manufacturing capabilities while diversifying the business into a broader aftermarket towing and truck accessories provider.”
Audax invests in middle-market companies that have from $8 million to $50 million in EBITDA and enterprise values of $50 million to $400 million. Sectors of interest include business and consumer services; energy; healthcare; technology, media and telecom; and industrials including chemicals, infrastructure, and building materials. Audax is currently investing out of its $3.5 billion, sixth private equity fund. The firm has offices in Boston, New York, and San Francisco.
LCI Industries (NYSE: LCII) manufactures components used by original equipment manufacturers of recreational vehicles, buses, trailers, trucks, trains, and modular housing. LCI’s products include steel chassis; axles and suspensions; thermoformed bath and kitchen products; vinyl, aluminum, and frameless windows; stabilizer and leveling systems; entry and patio doors; towing products and truck accessories; and electronic components. The Elkhart, Indiana-based company was founded in 1962 and has 85 manufacturing and distribution facilities located throughout North America and Europe.
LCI funded the purchase price of CURT through a combination of available cash, borrowings under its revolving credit facility, and an incremental term loan of $300 million under an existing credit agreement.
© 2020 Private Equity Professional | January 6, 2020