Acacia Research Corporation Acquires Deflecto®
Acacia Research (Nasdaq: ACTG) has acquired Deflecto Acquisition, Inc. for $103.7 million. Deflecto, a leading specialty manufacturer of essential products for commercial transportation, HVAC, and office markets, is expected to generate $128-$136 million in revenue in 2024. The acquisition is anticipated to be immediately accretive to Acacia's free cash flow and earnings per share.
Deflecto will continue to be led by CEO Ross Pliska and the existing management team. The company serves over 1,500 customers globally through nine manufacturing facilities across the US, Canada, UK, and China. The transaction was funded using cash on hand and borrowings under a new senior secured credit facility, with JPMorgan Chase as the lead arranger.
Acacia Research (Nasdaq: ACTG) ha acquisito Deflecto Acquisition, Inc. per 103,7 milioni di dollari. Deflecto, un produttore specializzato di prodotti essenziali per il trasporto commerciale, HVAC e mercati d'ufficio, si prevede genererà 128-136 milioni di dollari di ricavi nel 2024. Si stima che l'acquisizione porterà immediati benefici al flusso di cassa libero e agli utili per azione di Acacia.
Deflecto continuerà ad essere guidata dal CEO Ross Pliska e dal team di gestione esistente. L'azienda serve oltre 1.500 clienti a livello globale attraverso nove stabilimenti di produzione negli Stati Uniti, Canada, Regno Unito e Cina. La transazione è stata finanziata utilizzando liquidità disponibile e prestiti sotto un nuovo diritto di credito senior garantito, con JPMorgan Chase come arrangiatore principale.
Acacia Research (Nasdaq: ACTG) ha adquirido Deflecto Acquisition, Inc. por 103,7 millones de dólares. Deflecto, un importante fabricante especializado de productos esenciales para el transporte comercial, HVAC y mercados de oficinas, se espera que genere 128-136 millones de dólares en ingresos en 2024. Se anticipa que la adquisición será inmediatamente beneficiosa para el flujo de caja libre y las ganancias por acción de Acacia.
Deflecto continuará siendo dirigida por el CEO Ross Pliska y el equipo de gestión actual. La compañía atiende a más de 1.500 clientes en todo el mundo a través de nueve instalaciones de fabricación en EE. UU., Canadá, Reino Unido y China. La transacción se financió utilizando efectivo disponible y préstamos bajo un nuevo crédito senior garantizado, con JPMorgan Chase como organizador principal.
Acacia Research (Nasdaq: ACTG)가 Deflecto Acquisition, Inc.를 1억 370만 달러에 인수했습니다. Deflecto는 상업 운송, HVAC 및 사무실 시장을 위한 필수 제품의 선도적인 전문 제조업체로, 2024년에 1억 2800만-1억 3600만 달러의 수익을 창출할 것으로 예상됩니다. 이번 인수는 Acacia의 자유 현금 흐름과 주당 수익에 즉각적인 긍정적 영향을 미칠 것으로 예상됩니다.
Deflecto는 CEO Ross Pliska와 기존 관리팀이 계속 이끌어갈 것입니다. 이 회사는 미국, 캐나다, 영국 및 중국에 걸쳐 아홉 개의 제조 시설을 통해 전 세계적으로 1,500명 이상의 고객에게 서비스를 제공합니다. 이번 거래는 현금 자산과 새로운 선순위 담보 신용 시설을 통해 자금을 마련하였으며, JPMorgan Chase가 주선사로 참여했습니다.
Acacia Research (Nasdaq: ACTG) a acquis Deflecto Acquisition, Inc. pour 103,7 millions de dollars. Deflecto, un fabricant spécialisé leader de produits essentiels pour le transport commercial, le CVC et les marchés de bureaux, devrait générer 128-136 millions de dollars de revenus en 2024. On s'attend à ce que l'acquisition ait un effet immédiat et positif sur le flux de trésorerie disponible et le bénéfice par action d'Acacia.
Deflecto continuera d'être dirigée par le PDG Ross Pliska et l'équipe de direction existante. L'entreprise dessert plus de 1.500 clients dans le monde entier à travers neuf installations de fabrication aux États-Unis, au Canada, au Royaume-Uni et en Chine. La transaction a été financée par des liquidités disponibles et des prêts dans le cadre d'une nouvelle facilitation de crédit senior sécurisé, JPMorgan Chase étant l'arrangeur principal.
Acacia Research (Nasdaq: ACTG) hat Deflecto Acquisition, Inc. für 103,7 Millionen Dollar übernommen. Deflecto, ein führender Spezialist für die Herstellung von unverzichtbaren Produkten für den kommerziellen Transport, HVAC und Bürobereiche, wird voraussichtlich 128-136 Millionen Dollar Umsatz im Jahr 2024 erzielen. Die Übernahme wird voraussichtlich sofort positive Auswirkungen auf den freien Cashflow und den Gewinn pro Aktie von Acacia haben.
Deflecto wird weiterhin von CEO Ross Pliska und dem vorhandenen Managementteam geleitet. Das Unternehmen bedient über 1.500 Kunden weltweit über neun Produktionsstätten in den USA, Kanada, dem Vereinigten Königreich und China. Die Transaktion wurde mit vorhandenen liquiden Mitteln und Darlehen im Rahmen einer neuen nachrangigen gesicherten Kreditfazilität finanziert, wobei JPMorgan Chase als Hauptvermittler auftrat.
- Acquisition expected to deliver significant revenue to Acacia
- Transaction immediately accretive to free cash flow and earnings per share
- Deflecto projected to generate $128-$136 million in revenue in 2024
- Diversified product portfolio serving essential markets
- Strong customer base with over 1,500 leading retail, wholesale, and OEM customers
- Attractive cash conversion characteristics and modest capital requirements
- Increased debt with $48 million outstanding under new credit facility
Insights
This acquisition of Deflecto by Acacia Research is a significant move that could substantially impact ACTG's financial performance. The
Key points to consider:
- Deflecto's diverse product portfolio and customer base provide revenue stability
- The acquisition aligns with Acacia's strategy of acquiring businesses in industrial sectors
- Potential for operational synergies and M&A opportunities could drive further value creation
- The new credit facility used to partially fund the acquisition adds debt to Acacia's balance sheet, which should be monitored
Overall, this acquisition appears to be a strategic move that could enhance Acacia's financial position and growth prospects, potentially making it more attractive to investors focused on industrial sector consolidation plays.
Acacia's acquisition of Deflecto is a strategic move that diversifies its portfolio into essential product manufacturing. This deal taps into stable markets with regulatory-driven demand, particularly in commercial transportation and HVAC. The acquisition brings several advantages:
- Market leadership in niche segments
- A broad customer base of over 1,500 clients, reducing concentration risk
- Global manufacturing presence, potentially offering supply chain advantages
- Opportunities for cross-selling and expansion into adjacent markets
The expected revenue of
Transaction Adds Leading Speciality Manufacturer of Essential Products Serving the Commercial Transportation, HVAC and Office Markets to Acacia’s Growing Portfolio
Expected to Deliver Significant Revenue and be Immediately Accretive to Free Cash Flow and Earnings Per Share with Further Value Creation Opportunities
Deflecto Expected to Generate Approximately
Deflecto is a market leader across each of its segments and end markets, supplying essential, regulatory mandated products to a blue-chip customer base via long-term relationships with more than 1,500 leading retail, wholesale and OEM customers and distribution partners globally. Its products include emergency warning triangles and vehicle mudguards used by the transportation industry, various airducts and air registers used by the HVAC market and literature, sign holders and floormats used by the office market. Deflecto manufactures its products at nine manufacturing facilities across
In the trailing twelve-month period ended August 31, 2024, Deflecto generated revenue of approximately
Martin (“MJ”) D. McNulty, Jr., Acacia’s Chief Executive Officer, commented:
“We are pleased to add Deflecto to Acacia’s growing portfolio of strategic assets. This acquisition is consistent with the types of opportunities we look for. Deflecto fits in our target size range, sells diversified and necessary goods and has an excellent management team, led by Ross, with a demonstrated track record of operational execution and capital allocation.
With attractive cash conversion characteristics, modest capital requirements and attractive value creation opportunities we are pleased to add Deflecto as a key business to our growing portfolio. The transaction is expected to deliver immediate and significant revenue to Acacia and be accretive to free cash flow and earnings per share. We believe Deflecto presents attractive near and long-term term value creation opportunities through product and operational optimization, as well as strategic M&A.”
Ross Pliska, Deflecto’s Chief Executive Officer, commented:
“The transaction with Acacia is a seamless fit and the culmination of Deflecto’s efforts since 2021 to significantly improve Deflecto’s financial and operational performance across the business. Acacia’s experienced management team has a history of successfully integrating acquisitions and offers industry expertise, additional capital for future investments and immediate value creation. We can’t wait to start working with MJ and the rest of the Acacia team.”
The Transaction was funded utilizing cash on hand and borrowings under a new senior secured credit facility (the “Facility”) guaranteed by certain subsidiaries of Deflecto. JPMorgan Chase is acting as the lead arranger and administrative agent under the Facility, and the Facility is syndicated among other financial institutions. Following distribution of the Transaction proceeds, Deflecto will have approximately
Advisors
Baker Botts acted as legal advisor and Deloitte acted as financial advisor to Acacia on the Transaction. Vedder Price acted as legal advisor and TD Cowen, a division of TD Securities, acted as financial advisor to Deflecto on the Transaction.
About Acacia
Acacia is a publicly traded (Nasdaq: ACTG) company that is focused on acquiring and operating attractive businesses across the mature technology, energy, and industrial/manufacturing sectors where it believes it can leverage its expertise, significant capital base, and deep industry relationships to drive value. Acacia evaluates opportunities based on the attractiveness of the underlying cash flows, without regard to a specific investment horizon. Acacia operates its businesses based on three key principles of people, process and performance and has built a management team with demonstrated expertise in research, transactions and execution, and operations and management. Additional information about Acacia and its subsidiaries is available at www.acaciaresearch.com.
About Deflecto®
Deflecto and its family of companies make life essential products. Headquartered in
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based upon Acacia’s current expectations and speak only as of the date hereof. All statements, other than statements of historical fact are forward-looking statements. Words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “opportunity,” “outlook,” “plan,” “positioned,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar words may be used to identify forward-looking statements; however, the absence of these words does not mean that the statements are not forward-looking. While Acacia believes its assumptions concerning future events are reasonable, a number of factors could cause actual results to differ materially from those projected, including, but not limited to: any inability to retain employees and management team(s) at Deflecto; any inability to successfully integrate Deflecto; facts that were not revealed in the due diligence process in connection with acquisition of Deflecto; disruptions or uncertainty caused by changes to Deflecto’s management team; Deflecto’s future results of operations, inflationary pressures, supply chain disruptions or labor shortages; non-performance by third parties of contractual or legal obligations; changes in the Company’s credit ratings; hazards such as weather conditions, a health pandemic (similar to COVID-19), acts of war or terrorist acts and the government or military response thereto; security threats, including cybersecurity threats and disruptions to the Company’s business and operations from breaches of information technology systems, or breaches of information technology systems, facilities and infrastructure of third parties with which the Company transacts business; changes in safety, health, environmental, tax and other regulations, requirements or initiatives; and unknown operating and economic factors that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. For further discussions of risks and uncertainties, you should refer to Acacia’s filings with the Securities and Exchange Commission, including the “Risk Factors” section of Acacia’s most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q. Acacia undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances occurring after the date of this new release, except as required by law. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this news release. All forward-looking statements are qualified in their entirety by this cautionary statement.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241021690083/en/
Investor Contact:
Gagnier Communications
ir@acaciares.com
Derek Sarsfield, CHRO
Derek.Sarsfield@deflecto.com
Source: Acacia Research Corporation
FAQ
How much did Acacia Research (ACTG) pay for Deflecto?
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