Bufab, a Swedish supplier of nuts, bolts, screws and similar hardware, has entered into an agreement to acquire all outstanding shares in the U.S. company American Bolt & Screw, with annual sales of about $52 million.
The acquisition will be financed within Bufab’s existing credit facilities. The purchase price paid upon closing of the transaction amounts to $30 million on a cash-free/debt-free basis. A further deferred purchase price of $30 million will be paid in instalments, mainly from 2023 to 2024.
American Bolt & Screw (ABS) is a distributor of fasteners and other C-class components in the North American market. It is headquartered in Ontario, Calif., and has branch offices also in Indiana, Georgia, Texas, Oregon and Arizona. ABS was founded in 1946, and since 1982 has been fully owned and run by Jim Hooper, its current president.
Under his leadership, ABS has expanded to a nation-wide supply chain partner to customers across many industries. In the twelve-month period ending September, ABS had 96 employees and sales of about $52 million with an 11 percent normalized operating margin.
“It gives me great pleasure to announce that ABS is joining the Bufab Group,” said Jörgen Rosengren, Bufab’s president and CEO. “Over many meetings in the past two years, we have gotten to know the company well, and see great similarities to Bufab in the solution-oriented, entrepreneurial approach to creating customer value.
“We are confident that ABS will continue to grow and thrive as a member of the Bufab Group,” said Urban Bülow, group director in North America. “The acquisition of ABS also strengthens Bufab’s offering to global customers and provides us with a stronger base for further expansion in North America.”
“By joining Bufab, we will be able to continue to improve our customer service, grow our business and strengthen our team in the same way we have for the last decades,” said Hooper. “It will be business as usual, with the same high ambition level, but now as a part of a globally leading organization. I am pleased to continue as senior advisor to ABS, and together with the whole ABS team I look forward to the cooperation with Bufab.”
Finally, a performance-based additional payment may occur in 2023 conditional on a significantly improved operating profit. The transaction is expected to close today and will be reported within Bufab’s segment International.
ABS is expected to contribute to Bufab’s earnings per share starting from the first quarter of 2020.
