UK-based Avon Rubber, under its subsidiary Avon Protection, is to acquire Team Wendy, a US-based supplier of helmets and helmet liner and retention systems for military and first responder markets, for US$130 million on a cash-free and debt-free basis, subject to a normalised level of working capital.
Together, Avon Protection and Team Wendy will create a global leader in head protection systems for the military and first responder markets, following Avon’s acquisition of Ceradyne from 3M earlier this year, it adds.
The acquisition is expected to close in the first quarter of Avon’s 2021 fiscal year ending Dec. 31, 2020. It is subject to Avon shareholder approval, as well as US regulatory approvals and satisfaction of customary closing conditions.
At the close of the transaction, Team Wendy will operate as a subsidiary of Avon from its current headquarters in Cleveland, Ohio and will continue to be led by its CEO Jose Rizo-Patron and its six department directors, who will all remain in their positions. Revenue in the year ended 31 December 2019 of US$44.2 million and EBITDA of US$13.4 million resulting in an EBITDA margin of 30.3%.
Avon Protection is the recognised global leader in respiratory and ballistic protection for the world’s militaries and first responders, with more than 1,200 employees in 12 global locations, around 70% of whom are based in the US. Avon has a primary listing on the London Stock Exchange and is a constituent of the FTSE 250 Index.
Avon Rubber also provided a trading update, stating that its Avon Protection and milkrite InterPuls units are still operating, with the firm still confident of meeting its current year expectations. It adds that its businesses have experienced “only minor disruption” resulting from the Covid-19 pandemic and demand has stayed strong.
Meanwhile, it will use funds from its disposal of Dairy business milkrite InterPuls towards the purchase of Team Wendy.
“The acquisition of Team Wendy is another important strategic step in the transformation of Avon Rubber into a leading provider of life critical personal protection systems,” said Paul McDonald, CEO of Avon. “Team Wendy is a high-quality business with complementary liner and retention system technologies and established positions in Rest of World Military and First Responder helmet markets. Bringing Team Wendy into the same family with our existing Helmets & Armor business establishes Avon Protection as a global leader in Military and First Responder helmets, with an enhanced and broader product portfolio with stronger capabilities and routes to market.”