Brunswick Corporation announced that it signed a definitive agreement to acquire Navico, a world leader specializing in marine electronics and sensors, for a sum equivalent to $ 1.05 billion.
As a result of this acquisition, Brunswick will add the industry-leading brands Lowrance, Simrad, B&G and C-MAP to its Advanced Systems Group (ASG), which includes the leading parts and accessories (P&A) brands in power supply from administration, digital control. and monitoring and network devices.
“The acquisition of Navico and its award-winning brands will immediately accelerate Brunswick’s ACES (Autonomy, Connectivity, Electrification and Shared Access) strategy and support our vision to deliver distinctive new products and technology-based experiences,” said Dave Foulkes, CEO of Brunswick Corporation. . “We will continue to invest in both organic initiatives and acquisitions to maintain our position of global product leadership, while the addition of the Lowrance, Simrad, B&G and C-MAP brands to our current portfolio will further strengthen our ability to provide consumers solutions, innovative and comprehensive integrated systems for our OEM customers.
Navico is a privately held global company based in Egersund, Norway, and a subsidiary of Altor Fund IV and Goldman Sachs Asset Management. It is a leading supplier of multifunction displays, depth sounders, autopilots, sonar, radar, and marine charts. The strong Navico brands are present in most of the major powerboat and sailboat markets for both commercial and leisure applications.
Navico’s revenues total approximately $ 470 million for the fiscal year ended May 31, 2021 and reveal attractive growth, strong margins and a capital efficient business model. Brunswick’s P&A segment represents approximately $ 1.5 million, or 35 percent of its total annual revenue in 2020. With the addition of Navico, Brunswick expects its P&A segment to generate revenue at a higher execution rate, at $ 2.0 million. Navico’s strong aftermarket orientation and attractive margin profile will further strengthen Brunswick’s ability to withstand economic cycles.
“After a strong period of growth, we are excited to join the Brunswick family to further enrich our offering and continue to support customers,” said Knut Frostad, President and CEO of Navico. “Everyone at Navico looks forward to starting this journey with Brunswick and sharing our passion and dedication with his team. Thanks to this collaboration, we will be able to offer customers a unique and integrated experience ”.
“Brunswick’s Advanced Systems Group has an unmatched global reach and the addition of Navico solidifies our commitment to creating a unique experience for yacht and OEM customers,” said Brett Dibkey, President, Advanced Systems Group. “We have a very broad product portfolio, ranging from general marine products to energy management solutions. We will rely on the specific expertise of each brand to generate revenue and operational synergies, driving the growth of both ASG and Navico. With the acquisition, we also welcome a highly talented and experienced consumer-oriented management team, which we anticipate will continue unchanged and who will play an important role in the implementation of our strategy.
Brunswick will use a combination of debt and cash on the balance sheet to finance the acquisition. The company continues to strive to maintain its investment grade rating and expects its debt / EBITDA ratio to be approximately 1.7 gross in the near future.
JP Morgan Securities LLC has served as the exclusive financial advisor to Brunswick Corporation and is providing secured financing; Baker McKenzie and Schjødt are Brunswick Corporation’s legal counsel for this transaction.
The transaction is expected to close in the second half of 2021 and will be subject to customary closing conditions, as well as review and approval by authorities.
