Tennant to acquire Applied Sweepers
February 26, 2008
MINNEAPOLIS, Minn., Feb. 15, 2008-Tennant Company announced that it has entered into a purchase agreement with Applied Sweepers, maker of Green Machines brand cleaning equipment. The deal, valued at approximately $68 million, is expected to close by the end of February or early March 2008. Completion of the transaction is subject to concluding routine environmental due diligence and other customary closing conditions.
Applied Sweepers, a privately-held company based in Falkirk, Scotland, with 2007 revenues of roughly $40 million, is recognized as the leading manufacturer of sub-compact outdoor sweeping machines in the United Kingdom and operates overseas subsidiaries in the United States, France and Germany. Applied Sweepers is the leading supplier of smaller sweepers used for city cleaning to municipalities across the UK and sells through a broad distribution network around the world.
“Tennant Company sees tremendous potential to build upon Applied Sweepers highly-regarded service organization, its pride in innovation and, of course, its stellar reputation for high-quality products,” said Chris Killingstad, President and CEO of Tennant Company. “We have found a strong and beneficial alignment of Tennant Company’s long-term goals and those of Applied Sweepers: International market expansion, innovative product development, improving operational efficiencies and leveraging a strong distributor network.”
Sold under the brand name “Green Machines,” Applied Sweepers’ products come in three ranges and are used in city cleaning applications such as sweeping pavements, pedestrian areas, streets and alleyways. Killingstad noted that this series of city cleaning products complements Tennant Company’s current outdoor offerings, particularly in Europe, and will enhance Tennant Company’s ability to offer a broader set of solutions to customers worldwide.
"Applied Sweepers is very excited about its future within Tennant Company,” commented Francis Galashan, Chairman of Applied Sweepers. “Both are world-leaders with a proven pedigree in producing high quality, strongly innovative solutions to customers' cleaning needs. The complementary fit between our two companies' current product lines and our respective areas of strength in distributor networks makes us believe this will be a very successful partnership."
Killingstad and Galashan confirmed that current Applied Sweepers management will stay in place to continue to drive growth in the city cleaning business.
This acquisition, combined with its 2006 acquisition of Hofmans Machinefabriek in The Netherlands, provides Tennant Company greater access to the $250 million European city cleaning market and will provide opportunities to further leverage both companies’ existing sales and service capabilities around the world.
Killingstad noted that this transaction is consistent with the company's strategy of pursuing add-on acquisitions to gain access to interesting products or to expand its global sales and service coverage.