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Mike Rosendahl

E: mrosendahl@pcecompanies.com

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Industry Trends

Manufacturing Sector Rebounds in March

For the first time since September 2022, the manufacturing sector saw expansion in March 2024, with the Manufacturing PMI® hitting 50.3%. This marked a significant shift from a prolonged period of contraction, attributed to growth in new orders, production, and export and import activities. Despite ongoing challenges, such as employment contraction and high prices, the overall economic activity in manufacturing showed positive momentum, signaling improved conditions for the future.1

New National PFAS Water Standards May Impact Manufacturers

Effective April 10, 2024, the Biden-Harris Administration has established the first national drinking water standards for PFAS (Forever chemicals). The regulation aims to reduce exposure to these harmful chemicals across the country, safeguarding the health of approximately 100 million people by setting enforceable limits on the concentration of PFAS allowed in public water systems. The measure could drive up operational costs for certain manufacturers who require more advanced water treatment technologies to comply with the new standards.2

Rise of Smart Factories: Embracing Data Analytics and Efficiency

Manufacturers are on the brink of widespread adoption of smart factory technologies, transitioning from sporadic use to comprehensive systems. The shift is driven by the integration of sensors in newer machinery, competitive pressures, and the decreasing costs of smart technology. The international company Honeywell is a well-known company that is implementing these strategies. With benefits like proactive maintenance, enhanced process insights, and cost reduction, factories are embracing this evolution towards smarter, more efficient operations.3

New Car Appeal Surges as Used Car Market Struggles

In Q1 2024, the automotive industry experienced a shift in consumer preference towards new vehicles. Used car prices have increased significantly due to low inventory and high-interest rates, which have raised monthly payments on used cars to about 40% above pre-pandemic levels. New cars have become a relatively more affordable option, and car manufacturers are leveraging the trend by providing enhanced incentives. New cars reached peak affordability levels in February 2024, the highest since July 2021.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • PGT Innovations, Inc.
  • MITER Brands
  • $3,196.88
  • Yak Access, LLC
  • United Rentals, Inc.
  • $1,150.00
  • DE-STA-CO
  • Stabilus SE
  • $680.00
  • Signature Systems Group, LLC
  • Myers Industries, Inc.
    rise Pte. Ltd.
  • $350.00
  • Kamco Building Supply Corp.
  • GMS Inc.
  • $321.50
  • Collins Bus Corporation
  • Forest River Bus, LLC
  • $303.00
  • Powered Business of Proterra Operating Company
  • AB Volvo (publ)
  • $210.00
  • Key Knife, Inc./Key Knife Canadian Investments Corporation
  • Kadant Canada Corp.
  • $156.00
  • Residential Lighting business of Hubbell Incorporated
  • Kingswood Capital Management, L.P.
  • $131.00
  • Precision Rentals LLC
  • H&E Equipment Services, Inc.
  • $117.60

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Hennessy Industries, LLC
  • Victor Capital Partners LLC
  • $72.50
  • LaGuardia Gateway Partners, LLC
    International Corporation
  • Meridiam Infrastructure Finance S.a.r.l.
  • $58.00
  • Conserve-A-Watt Lighting, Inc.
  • Blue Harbour Capital
  • n/a
  • Spartan Tool Supply
  • Foundation Investment Partners, LLC
  • n/a
  • Electro-Mechanical, LLC
  • Oaktree Capital Management, L.P.
  • n/a
  • Sun Industrial Group, LLC
  • Fernweh Group LLC
  • n/a
  • SurfacePrep
  • Nautic Partners, LLC
  • n/a
  • Arctic Industries, Inc.
  • Kinzie Capital Partners LP
  • n/a
  • Technical Products, Inc.
  • Borgman Capital LLC
  • n/a
  • SmitHahn Company, Inc.
  • Gmac Holdings, LLC
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Josam Company
  • Watts Water Technologies, Inc.
  • $102.80
  • KWS Manufacturing Company, Ltd.
  • Kadant Inc.
  • $84.00
  • Lake City Heat Treating Corporation
  • Bodycote plc
  • $66.50
  • LaGuardia Gateway Partners, LLC
  • Vantage Airport Group (Us) Ltd.
  • $57.00
  • Substantially all the assets of Consolidated Container Company, LLC
  • BWAY Corporation
  • $56.00
  • Botrista Technology, Inc.
  • Jollibee Worldwide Pte. Ltd.
  • $28.00
  • SNC Manufacturing Co., Inc.
  • Allient Inc.
  • $20.00
  • Iconn, Inc.
  • Cape EMS Berhad
  • $16.50
  • Substantially All Assets of Lightning eMotors, Inc. and Lightning Systems, Inc.
  • GERCO LLC
  • $12.60
  • Sustainable Energy Group, Inc.
  • CuraScientific Corp.
  • $5.00

 

Source S&P Capital IQ as of 4/16/2024 and PCE Proprietary Data

PCE Transactions

Contacts

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

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Ken Sommers

Denver Office

303-276-7985 |

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Michael Poole

Orlando Office

407-621-2112 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. 1. "Manufacturing PMI® at 50.3%; March 2024 Manufacturing ISM® Report On Business®." PRNewswire, 1 Apr. 2024.
  2. 2. Biden-Harris Administration Finalizes First-Ever National Drinking Water Standard to Protect 100M People from PFAS Pollution." EPA Press Office, 10 Apr. 2024.
  3. 3. "Manufacturing Trends." Advanced Technology Services, www.advancedtech.com/blog/manufacturing-trends/.
  4. 4. Lee, Jinjoo. "CarMax Gets Slammed by High Rates, Tight Used-Car Supply." The Wall Street Journal, 12 Apr. 2024.
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