Hillenbrand to Acquire Herbold Meckesheim, Expanding Customer Offering for Complete Recycling Solutions

Rhea-AI Summary

Hillenbrand (NYSE: HI) is set to acquire Herbold Meckesheim GmbH for approximately €79 million. The deal, expected to close in the fourth fiscal quarter of 2022, aims to enhance Hillenbrand's recycling technology offerings. Herbold, with annual revenues exceeding €50 million, complements Hillenbrand's Coperion brand and reinforces its commitment to sustainable solutions. The acquisition is anticipated to be accretive to adjusted EPS within the first year and achieve double-digit ROIC by year three, supporting Hillenbrand's long-term growth strategy in the recycling market.

Positive

• Acquisition enhances Hillenbrand's long-term growth strategy in recycling.
• Highly complementary to Coperion branded products, expanding technology offerings.
• Expected to be accretive to adjusted EPS in the first year, improving profitability.
• Projected double-digit return on invested capital (ROIC) by year three.

Negative

• None.

• Advances Hillenbrand's long-term growth strategy into key end market of recycling
• Highly complementary technologies to Coperion branded products
• Enhances offering of complete recycling solutions and provides compelling cross-selling opportunities
• Expected to be accretive to Adj. EPS within first full year and deliver double-digit ROIC by year 3

BATESVILLE, Ind., June 30, 2022 /PRNewswire/ -- Hillenbrand, Inc. (NYSE: HI) has entered into a definitive agreement to acquire Herbold Meckesheim GmbH (Herbold) for an enterprise value of approximately €79 million. The transaction is expected to close during the fiscal fourth quarter of 2022, subject to regulatory approval and customary closing conditions.

Based in Meckesheim, Germany, Herbold is a leader in recycling systems, specializing in key process steps such as washing, separating, drying, shredding, and pulverizing. With annual revenue of more than €50 million, Herbold is highly complementary to the equipment and solutions offered under our Coperion brand and will accelerate Hillenbrand's growth opportunities in the recycling end market.

At the completion of this transaction, Herbold will join the Coperion and Rotex brands as part of Hillenbrand's Advanced Process Solutions (APS) segment. The APS segment is focused on highly engineered industrial processing solutions and aftermarket parts and services for a variety of end markets and applications.

"I am very excited to announce the acquisition of Herbold, which reinforces our commitment to growing as a world-class industrial company, executing our strategy to deliver long-term shareholder value, and accelerating our efforts to support a more sustainable future," said Kim Ryan, President and CEO of Hillenbrand. "Herbold expands our position in the recycling end market, which has attractive, long-term growth prospects due to macro demand drivers for durable plastics and the desire for more sustainable solutions. Herbold will have a strong strategic fit with our Coperion brand, and together, we will be able to offer complete recycling solutions to our customers. Finally, we expect to enhance Herbold's performance through the deployment of the Hillenbrand Operating Model and utilization of our global sales and service capabilities."

Hillenbrand expects to use cash on hand and cash available under its revolving credit facility to fund this acquisition.

About Hillenbrand

Hillenbrand (NYSE: HI) is a global industrial company operating in over 40 countries with over 10,000 associates serving a wide variety of industries around the world. Guided by our Purpose — Shape What Matters For Tomorrow™ — we pursue excellence, collaboration, and innovation to consistently shape solutions that best serve our associates, customers, communities, and other stakeholders. Hillenbrand's portfolio includes brands such as Coperion, Milacron Injection Molding & Extrusion, and Mold-Masters, in addition to Batesville. To learn more, visit: www.Hillenbrand.com

Forward-Looking Statements

Throughout this release, we make a number of "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, and that are intended to be covered by the safe harbor provided under these sections. As the words imply, these are statements about future sales, earnings, cash flow, results of operations, uses of cash, financings, share repurchases, ability to meet deleveraging goals, and other measures of financial performance or potential future plans or events, strategies, objectives, beliefs, prospects, assumptions, expectations, and projected costs or savings or transactions of the Company that might or might not happen in the future, as contrasted with historical information. Forward-looking statements are based on assumptions that we believe are reasonable, but by their very nature are subject to a wide range of risks. If our assumptions prove inaccurate or unknown risks and uncertainties materialize, actual results could vary materially from Hillenbrand's (the "Company") expectations and projections.

Words that could indicate that we are making forward-looking statements include the following:

intend	believe	plan	expect	may	goal	would	project
become	pursue	estimate	will	forecast	continue	could	anticipate
target	encourage	promise	improve	progress	potential	should	impact

This is not an exhaustive list, but is intended to give you an idea of how we try to identify forward-looking statements. The absence of any of these words, however, does not mean that the statement is not forward-looking.

Here is the key point: Forward-looking statements are not guarantees of future performance or events, and actual results or events could differ materially from those set forth in any forward-looking statements. Any number of factors, many of which are beyond our control, could cause our performance to differ significantly from what is described in the forward-looking statements. These factors include, but are not limited to: risks related to the Russian Federation's invasion of Ukraine (referred to herein as the "Ukraine War") and resulting geopolitical instability and uncertainty, which could have a negative impact on our ability to sell to, ship products to, collect payments from, and support customers in certain regions, in addition to the potential effect of supply chain disruptions that could adversely affect profitability; the impact of contagious diseases such as the COVID-19 pandemic and the escalation thereof due to variant strains of the virus and the societal, governmental, and individual responses thereto, including supply chain disruption, loss of contracts and/or customers, erosion of some customers' credit quality, downgrades of the Company's credit quality, closure or temporary interruption of the Company's or suppliers' manufacturing facilities, travel, shipping and logistical disruptions, domestic and international general economic conditions, such as inflation, exchange rates and interest rates; loss of human capital or personnel, and general economic calamities; increased costs, poor quality, or unavailability of raw materials or certain outsourced services and supply chain disruptions; increasing competition for highly skilled and talented workers as well as labor shortages; the risk of business disruptions associated with information technology, cyber-attacks, or catastrophic losses affecting infrastructure; risks that the integration of Milacron disrupts current operations or poses potential difficulties in employee retention or otherwise affects financial or operating results; the ability to recognize the benefits of the acquisition of Milacron or any other acquisition or disposition, including potential synergies and cost savings or the failure of the Company or any acquired company to achieve its plans and objectives generally; impairment charges to goodwill and other identifiable intangible assets; competition in the industries in which we operate; impacts of decreases in demand or changes in technological advances, laws, or regulation on the revenues that we derive from the plastics industry; our reliance upon employees, agents, and business partners to comply with laws in many countries and jurisdictions; the impact of incurring significant amounts of indebtedness and any inability of the Company to respond to changes in its business or make future desirable acquisitions; the ability of the Company to comply with financial or other covenants in its debt agreements; global market and economic conditions, including those related to the financial markets; our level of international sales and operations; cyclical demand for industrial capital goods; the dependence of our business units on relationships with several large customers and providers; the impact to the Company's effective tax rate of changes in the mix of earnings or tax laws and certain other tax-related matters; involvement in claims, lawsuits and governmental proceedings related to operations; uncertainty in the United States political and regulatory environment or global trade policy; adverse foreign currency fluctuations; labor disruptions; and the effect of certain provisions of the Company's governing documents and Indiana law that could decrease the trading price of the Company's common stock. Shareholders, potential investors, and other readers are urged to consider these risks and uncertainties in evaluating forward-looking statements and are cautioned not to place undue reliance on the forward-looking statements. For a more in-depth discussion of these and other factors that could cause actual results to differ from those contained in forward-looking statements, see the discussions under the heading "Risk Factors" in Part I, Item 1A of Hillenbrand's Form 10-K for the year ended September 30, 2021, filed with the Securities and Exchange Commission ("SEC") on November 17, 2021, and in Part II, Item 1A of Hillenbrand's Form 10-Q for the quarter ended March 31, 2022, filed with the SEC on May 9, 2022. The forward-looking information in this release speaks only as of the date hereof, and we assume no obligation to update or revise any forward-looking information.

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/hillenbrand-to-acquire-herbold-meckesheim-expanding-customer-offering-for-complete-recycling-solutions-301579184.html

SOURCE Hillenbrand, Inc.

FAQ

What is the value of Hillenbrand's acquisition of Herbold?

The acquisition of Herbold Meckesheim GmbH is valued at approximately €79 million.

When is Hillenbrand's acquisition of Herbold expected to close?

The acquisition is expected to close during the fourth fiscal quarter of 2022, pending regulatory approval.

How will the acquisition of Herbold benefit Hillenbrand?

The acquisition will enhance Hillenbrand's recycling technology offerings, support market expansion, and is expected to improve adjusted EPS.

What revenue does Herbold generate?

Herbold generates annual revenue exceeding €50 million.

What is the expected return on invested capital from the acquisition?

Hillenbrand expects to achieve double-digit return on invested capital (ROIC) by year three after the acquisition.