Heavy tools vendor Cervus Gear, which owns a big Peterbilt supplier community in Canada, has agreed to be acquired by Brandt Tractor for CA$302 million ($240 million) in a deal that may take the corporate personal.
The deal, introduced Monday, has Alberta-based Brandt Tractor paying CA$19.50 per share for Cervus (TSX: CRV), a 22% premium over Friday’s closing value. The transaction would shut within the fourth quarter if shareholders approve the sale at a particular assembly in September.
“As a personal firm with a dedicated, well-capitalized, and long-term proprietor, Cervus will likely be higher positioned for the subsequent stage of evolutionary development for our dealerships,” Cervus CEO Angela Lekatsas mentioned in a statement. “The dimensions and scale of the entity created by the mix of our two firms will permit for elevated funding into Cervus for the good thing about our workers and clients.”
Brandt Tractor is a serious John Deere (NYSE: DE) supplier, with over 50 places. The corporate additionally has a smaller division catering to specialised trucking, Brandt Truck Rigging & Trailers, primarily based in Alberta.
“The Brandt group is happy about this deal as it’s going to permit us to higher serve our buyer base throughout Canada,” Brandt CEO Shaun Semple mentioned in an announcement.
Cervus owns 16 Peterbilt dealerships in Canada as half of a bigger enterprise centered on promoting heavy tools for the agriculture sector. Peterbilt is supporting the deal, Cervus mentioned.
Cervus’ Peterbilt sellers and repair facilities generated practically CA$91.5 million income through the second quarter, greater than 50% larger in comparison with a yr in the past. The corporate has benefitted from a rebound in Canada’s trucking business.
Reflecting the excessive demand for brand new vans, Cervus mentioned in its second-quarter monetary report that just about all of its trucking stock had been dedicated to clients. The corporate warned that shortages in semiconductors and different components might hinder its skill to satisfy clients’ calls for.