CPE News (7/5/2021) – Brookfield Business Partners L.P. (NYSE: BBU; TSX:BBU.UN), together with institutional partners, has agreed to acquire DexKo Global Inc. from KPS Capital Partners for US $3.4 billion.
Brookfield’s investment will be funded with approximately US $1.1 billion of equity, of which Brookfield Business Partners intends to invest approximately US $400 million. The balance of the equity investment will be funded by institutional partners. Prior to or following closing, a portion of Brookfield Business Partners’ commitment may be syndicated to other institutional investors.
Novi, Michigan based DexKo is a global manufacturer of highly engineered components for trailer, recreational vehicle and towable equipment providers. The Company has a leading presence in its core products across North America, Europe and Australia with vertically integrated production and distribution capabilities and a commitment to sustainability. DexKo manufactures and distributes over 65,000 products including highly engineered, customized solutions for a diverse range of customers across its global footprint.
In 2012, Sterling Group, L.P. acquired Dexter Axle, Ventline, and Dexter Door from Tomkins. In December 2015, Dexter and AL-KO Vehicle Technology (VT) merge to form DexKo Global. In July 2017, KPS Capital Partners acquired DexKo Global from Sterling Group.
photo credit: DexKo Global
News Release
Brookfield Business Partners to Acquire DexKo Global
BROOKFIELD, NEWS, July 05, 2021 (GLOBE NEWSWIRE) — Brookfield Business Partners L.P. (NYSE:BBU) (TSX:BBU.UN) (“Brookfield Business Partners”) together with institutional partners (collectively “Brookfield”) today announced an agreement to acquire DexKo Global Inc. (“DexKo” or “the Company”) for $3.4 billion.
DexKo is a global manufacturer of highly engineered components for trailer, recreational vehicle and towable equipment providers. The Company has a leading presence in its core products across North America, Europe and Australia with vertically integrated production and distribution capabilities and a commitment to sustainability. DexKo manufactures and distributes over 65,000 products including highly engineered, customized solutions for a diverse range of customers across its global footprint.
“We are pleased to grow our industrials operations with the acquisition of DexKo, a market leader known for quality and reliability,” said Mark Weinberg, Managing Partner, Brookfield Business Partners. “DexKo’s world-class management team has delivered consistently strong performance and we are excited to partner with them to further build on an established track record of value creation.”
Investment Highlights
Strong market position. DexKo has a leading presence in multiple core categories, offering the industry’s widest breadth of products and custom configurations with a reputation for delivering high value solutions for its customers.
Clear competitive differentiation. The Company’s hub and spoke, vertically integrated manufacturing network, broad product offering and distribution capabilities allow it to play a strategic role in a fragmented value chain, providing a competitive advantage in servicing both customers and business partners.
Durable cashflows. DexKo’s track record of consistent cash flow generation is supported by resilient underlying demand, diverse end markets and geographical scale.
Positioned for continued growth and value creation. Opportunity to enhance margins and grow through operational improvements and bolt-on acquisitions.
Funding
Brookfield’s investment will be funded with approximately $1.1 billion of equity, of which Brookfield Business Partners intends to invest approximately $400 million. The balance of the equity investment will be funded by institutional partners. Prior to or following closing, a portion of Brookfield Business Partners’ commitment may be syndicated to other institutional investors.
Transaction Process
Closing of the transaction remains subject to customary closing conditions including regulatory approvals. Closing is expected by the end of 2021.
Advisors
Financing will be led by a syndicate of banks including Credit Suisse, Deutsche Bank, BMO Capital Markets, Bank of America, Goldman Sachs and RBC Capital Markets. Davis Polk & Wardwell LLP is acting as legal advisor to Brookfield.
Brookfield Business Partners is a business services and industrials company focused on owning and operating high-quality businesses that benefit from barriers to entry and/or low production costs.
Brookfield Business Partners is the flagship listed business services and industrials company of Brookfield Asset Management, a leading global alternative asset manager with over $600 billion of assets under management. More information is available at www.brookfield.com.
Brookfield Business Partners is listed on the New York and Toronto stock exchanges. For more important information, please visit our website at https://bbu.brookfield.com.
For more information, please contact:
Media
Claire Holland
Tel: +1 416 369 8236
Email: claire.holland@brookfield.com
Investor Relations
Alan Fleming
Tel: +1 416 645 2736
Email: alan.fleming@brookfield.com