Linamar Buying MacDon
By Mike Brezonick14 December 2017
Linamar Corp. said it has entered a definitive agreement to acquire 100% of the outstanding equity interests of MacDon and its group of companies for an aggregate purchase price of $937,440,000 (C$1,2 billion), less the assumption of small transaction related expenses. The deal is subject to customary regulatory approvals and expected to close in the first quarter of 2018.
Headquartered in Winnipeg, Manitoba, Canada, MacDon is a global manufacturer of specialized agricultural harvesting equipment such as drapers and Cummins-powered self-propelled windrowers, all of which are built at a 900,000 sq. ft. facility in Winnipeg. Its products are distributed worldwide through network of approximately 1400 dealers.
Linamar, headquartered in Guelph, Ontario, Canada, is a diversified global manufacturing company made up of two operating segments — Powertrain/Driveline and Industrial — which are further divided into five operating groups – Machining & Assembly, Light Metal Casting, Forging, Skyjack and Agriculture.
“The acquisition of MacDon provides a truly once-in-a-lifetime opportunity to move our agriculture business into a market leading position while providing meaningful diversification to the end markets we serve,” said Linamar CEO Linda Hasenfratz. “We believe the long-term growth fundamentals for the agriculture industry are very strong given the growing and developing global population, noting the market is in the early stages of cyclical recovery.
“MacDon is a strong, well-managed company and an innovative market leader in both customer penetration and technology evolution. It will be the centerpiece of our agriculture business, which includes our existing European corn header business, highly complementary to MacDon products. We get diversification, innovation, growth and a solid deal — we couldn’t be happier.”
Linamar said MacDon will be combined with Linamar’s existing agriculture harvesting business in Hungary to position both businesses for significant growth. Linamar said its existing harvesting business is highly complementary to MacDon’s product plan, allowing Linamar to offer a full lineup of grain and hay harvesting equipment.
As it expands, MacDon will benefit from Linamar’s established manufacturing footprint in Asia and Europe along with employing best practices from both Linamar and MacDon.
Linamar has a long track record of executing strategic, accretive acquisitions, which have included aerial work platform manufacturer Skyjack in 2002, automotive components manufacturer Montupet in 2015 and forged components producer Seissenschmidt AG in 2015.