Australian supply chain logistics group Brambles is to acquire Aberdeenshire-based Ferguson Group for an enterprise value of £320 million (US$545 million) expanding its container business.
Ferguson Group provides container solutions to the offshore oil and gas sector.
It provides about 18,500 common, standardized containers for the transport of a wide variety of equipment, fluids and other items to and from customer facilities in the offshore oil and gas sector. It has regional hubs in the UK, Norway, Singapore, Australia and the United Arab Emirates and strategic business partners in other key industry locations worldwide.
In addition, Ferguson Group provides rental of other standard modular equipment and other specialist logistics services.
Brambles, which had sales of US$5,404.5 million in the year ended 30 June 2014, primarily serves the consumer goods, dry grocery, fresh food, retail and general manufacturing supply chains, with 14,000 staff and more than 470 million pallets, crates and containers managed through a network of about 850 service centres. In addition, the group operates specialist businesses serving the automotive, aviation and refining sectors.
Brambles CEO Tom Gorman said: “Ferguson Group is a very strong fit for Brambles, consistent with our strategy of diversifying in segments with strong equipment-pooling and growth characteristics. Combined with our presence in the downstream refining sector through CHEP Catalyst & Chemical Containers, Ferguson Group provides a platform for further expansion of our Containers offering in oil and gas."
Ferguson Group has a record of compound annual growth in sales revenue of 11% since 2009, and a compelling organic growth outlook, added Gorman.
"It has attractive margin and return on capital characteristics, which are strongly aligned with our objectives to create sustainable value for shareholders. We expect the acquisition to be accretive to Brambles’ underlying earnings per share4 from FY15.”
The acquisition price represents 10 times Ferguson Group’s forecast EBITDA for the 12 months ended 31 December 2014.
Brambles says it anticipates the deal will complete by the end of September 2014. Ferguson Group is chairman Steven Ferguson will remain a senior advisor to Brambles for six months subsequent to completion to assist with the transition.
The remainder of Ferguson Group’s key management team will continue to run the business as part of the Brambles Group.
Brambles started life as a butchery business, founded in Australia by the son of English migrants to the country. It saw with $584.5 million profit after tax in the year ended 30 June 2014.
Image: Ferguson employees in Australia. Photo from Ferguson.