ELGIN, Ill.--(BUSINESS WIRE)--May 18, 2018--
The Middleby Corporation (NASDAQ: MIDD) today announced that it has
entered into a definitive agreement to acquire the Taylor Company from
UTC Climate, Controls & Security, a unit of United Technologies for $1.0
billion. Taylor is a world leader in beverage solutions, soft serve and
ice cream dispensing equipment, frozen drink machines, and automated
double-sided grills. Middleby will finance the all-cash acquisition
under its existing revolving credit facility. In 2017, Taylor had
revenues of approximately $315 million and $65 million of adjusted
earnings before interest, taxes and depreciation (“EBITDA”). The
transaction has been structured to provide Middleby with a tax step-up
with a net present value of approximately $150 million. The transaction
completion is subject to customary closing conditions, including
regulatory approvals, with an expected closing early in the third
quarter of 2018.
Financial Highlights:
-
Transaction includes expected cash tax benefits of approximately $16
million annually, with a net present value of approximately $150
million, associated with a section 338(h)(10) election that creates a
depreciable/ amortizable “stepped-up” tax basis (to fair market value)
in certain Taylor U.S. assets
-
Targeted synergies in excess of $15 million
-
Expected to be EPS accretive within the first year of acquisition
-
Middleby Debt to EBITDA leverage ratio post transaction less than 3.0
times by end of 2018
-
Expected interest cost of LIBOR + 1.625% at transaction close
-
Estimated non-cash depreciation and amortization of $25 to $30 million
per annum
Selim A. Bassoul, Chairman and CEO, stated, “The acquisition of Taylor
is highly strategic for Middleby and bolsters Middleby’s overall
position as an industry leader in commercial foodservice. Taylor is a
unique and premium brand in the commercial foodservice industry with
leading positions in beverage, frozen dessert and grilling that are
highly complementary to our existing offerings. Taylor products are well
represented across the top restaurant chains and have significant
presence across all foodservice segments including quick serve, casual
dining, retail, convenience stores, and institutional foodservice
establishments. The acquisition further deepens our presence in these
categories and with existing customers for new offerings in the kitchen.
“Taylor provides a leading platform to continue to build our portfolio
of beverage solutions, complementing our existing brands and
technologies in this product category. We believe Taylor is well
positioned for growth as customers continue to invest in and expand
their beverage offerings. Additionally, there are significant technology
synergies amongst Taylor and our existing related businesses, which
should further add to the growth opportunities in this category.”
Mr. Bassoul continued, “The Taylor automated double-sided grill expands
our cooking lineup with an advanced technology that provides customers
with a specialized solution addressing labor savings, food safety and
superior cooking performance. This acquisition enhances Middleby’s
existing capabilities in automated cooking solutions and adds a critical
technology as we further develop our portfolio of automated cooking
solutions.”
Mr. Bassoul concluded, “We are very excited to have the Taylor
management team and employees join the Middleby group of companies. The
Taylor leadership team has deep industry experience and is highly
respected by customers. This team has guided the company to strong
levels of profitability and consistent financial performance over many
years. We look forward to having them continue to lead the Taylor
business, which will continue to operate from its existing facilities in
Rockton, Illinois.”
For more information on Taylor Company please visit www.taylor-company.com.
Conference Call
A conference call with management will be held at 8:30 a.m. central time
on Saturday, May 19 and can be accessed by dialing (888) 391-6937 or
(315) 625-3077 and providing conference code 1948928#. The conference
call and slides are also accessible through the Investor Relations
section of the company website at www.middleby.com.
A replay of the conference call will be available two hours after the
conclusion of the call by dialing (855) 859-2056 or (404) 537-3406 and
entering conference code 1948928#.
Statements made in this press release or otherwise attributable to the
company regarding the company’s business which are not historical fact
are forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. The
company cautions investors that such statements are estimates of future
performance and are highly dependent upon a variety of known and unknown
risks, uncertainties and other important factors that could cause actual
results to differ materially from such statements. Such factors include,
but are not limited to, the ability of the parties to successfully
consummate the proposed transaction, including receipt of required
regulatory approvals and satisfaction of other conditions to closing;
the risk that the Middleby and Taylor businesses will not be integrated
successfully; the risk that Middleby and Taylor will not realize
synergies or other benefits relating to the transaction in the amounts
anticipated or within the expected timeframe; the risk that disruption
from the transaction could adversely affect relationships with
customers, employees, distributors or suppliers; the level of end market
activity in Middleby’s and Taylor’s commercial and residential markets;
unpredictable difficulties or delays in the development of new product
technology; results of pending and future litigation; access to capital;
actions of domestic and foreign governments; variability in financing
costs; quarterly variations in operating results; dependence on key
customers; international exposure; foreign exchange and political risks
affecting international sales; changing market conditions; the impact of
competitive products and pricing and related market conditions; the
timely development and market acceptance of the company‘s products; the
availability and cost of raw materials; and other risks detailed herein
and from time-to-time in the company‘s SEC filings.
ABOUT THE MIDDLEBY CORPORATION
The Middleby Corporation is a global leader in the foodservice equipment
industry. The company develops, manufactures, markets and services a
broad line of equipment used in the commercial foodservice, food
processing, and residential kitchen equipment industries. The company's
leading equipment brands serving the commercial foodservice industry
include Anets®, Bear Varimixer®, Beech®, Blodgett®, Blodgett Combi®,
Blodgett Range®, Bloomfield®, Britannia®, Carter-Hoffmann®, Celfrost®,
Concordia®, CookTek®, CTX®, Desmon®, Doyon®, Eswood®, frifri®, Follett®,
Firex®, Giga®, Globe®, Goldstein®, Holman®, Houno®, IMC®, Induc®, Jade®,
JoeTap®, Josper®, L2F®, Lang®, Lincat®, MagiKitch'n®, Market Forge®,
Marsal®, Middleby Marshall®, MPC®, Nieco®, Nu-Vu®, PerfectFry®, Pitco
Frialator®, QualServ®, Southbend®, Star®, Sveba Dahlen®, Toastmaster®,
TurboChef®, Wells® and Wunder-Bar®. The company’s leading equipment
brands serving the food processing industry include Alkar®, Armor Inox®,
Auto-Bake®, Baker Thermal Solutions®, Burford®, Cozzini®, CVP Systems®,
Danfotech®, Drake®, Emico®, Glimek®, Hinds-Bock®, Maurer-Atmos®, MP
Equipment®, RapidPak®, Scanico®, Spooner Vicars®, Stewart Systems®,
Thurne® and Ve.Ma.C.®. The company’s leading equipment brands serving
the residential kitchen industry include AGA®, AGA Cookshop®, Brigade®,
Fired Earth®, Grange®, Heartland®, La Cornue®, Leisure Sinks®, Lynx®,
Marvel®, Mercury®, Rangemaster®, Rayburn®, Redfyre®, Sedona®, Stanley®,
TurboChef®, U-Line® and Viking®.
For more information about The Middleby Corporation and the company
brands, please visit www.middleby.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180518005759/en/
Source: The Middleby Corporation
The Middleby Corporation
Darcy Bretz, Investor and Public
Relations, (847) 429-7756