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Mike Rosendahl

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Industry Trends

UAW Strike Expands to 25,000 Workers

In September, the United Auto Workers Union (UAW) launched a strike against General Motors, Ford, and Stellantis over contract negotiations. The strike currently involves 25,000 workers as of the end of September, with more expected if a deal is not made soon. The union demands include a 36%-40% wage boost, living adjustments, and a shorter workweek. The strike's repercussions are expected to strain local economies, upset supply chains, and hike car prices for the foreseeable future.1 3

U.S. Manufacturing PMI Contractions Slow

The S&P Global U.S. Manufacturing PMI for September 2023 climbed to 48.9 from August's 47.9, surpassing the forecasted 48. The PMI indicates a slight recovery, but the sector still shows contraction. Factors include softer declines in output and orders, firms optimizing current inventories over new purchases, and a significant drop in post-production inventories. Hiring and input costs also increased, with only a slight rise in output prices.3

Automotive EV Industry Continues to Rebound

The automotive electric vehicle market rallied in Q3 2023, with sales and inventory levels rebounding from 2022. Sales volumes are projected to hit 15.5 million by September, an increase from 13.6 million in 2022. Q3 EV inventory has expanded, boasting a 97-day supply compared to 57 days in Q2 2022. The average EV price is now $53,376, down from $57,772 in 2021. Fleet sales, particularly from rental companies, are driving demand. However, the ongoing UAW strike introduces uncertainty for the market in Q4. 4

Oil Prices Tick Up in Q3

Oil prices edged towards $100 per barrel in September due to Saudi Arabia's substantial oil output cuts. Brent crude surged 30% since July, reaching $96.50/barrel. Despite rising global demand, the OPEC Plus group, including Russia, withholds about 5% of global oil supplies. Russia's oil export revenues hit a near-annual high in August. The price increases have heightened inflationary concerns globally, as oil prices significantly influence energy costs.5

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Univar Solutions Inc.
  • Apollo Global Management, Inc.; Abu Dhabi Investment Authority
  • $8,519.50
  • Diversey Holdings, Ltd.
  • Solenis LLC
  • $4,721.15
  • Triton International Limited
  • Brookfield Infrastructure Corporation
  • $4,689.69
  • Food and Performance Material (FPM) business of Schenck Process LLC
  • Milacron Holdings Corp.
  • $730.00
  • RTS Packaging, LLC/WestRock Company, Paper Mill in Chattanooga, Tennessee
  • Sonoco Products Company
  • $330.00
  • Howden Roots LLC
  • Ingersoll Rand Inc.
  • $300.00
  • Berkshire Grey, Inc.
  • SoftBank Group Corp.
  • $278.71
  • Exacta Systems, LLC
  • Churchill Downs Incorporated
  • $250.00
  • Tomahawk Robotics, Inc.
  • AeroVironment, Inc.
  • $116.25
  • Heating & Cooling Products, Inc.
  • Smiths Group plc
  • $82.00

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Midland Industries, LLC
  • Gemspring Capital Management, LLC
  • n/a
  • Isolatek International Corporation
  • SK Capital Partners, LP
  • n/a
  • Warshaw Incorporated
  • Dunes Point Capital, L.P.
  • n/a
  • EX Industries
  • Pesek & Mair, LLC
  • n/a
  • GMES, LLC
  • Incline Management, L.P.
  • n/a
  • Automatic Feed Co., Inc.
  • Nidec Corporation
  • n/a
  • Bruce Supply Corp.
  • Ferguson plc
  • n/a
  • Bourn & Koch, Inc.
  • InCompass LLC
  • n/a
  • Suburban Manufacturing, Inc.
  • PCM Companies, LLC
  • n/a
  • Mixer Systems, Inc.
  • Bel Air Growth Partners, LLC
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • ColePak Inc.
  • Greif, Inc.
  • $75.00
  • Substantially All of the Assets of the Wood Utility Pole Manufacturing Business of Baldwin Pole And
  • Stella-Jones Inc.
  • $47.59
  • Axiom Test Equipment, Inc.
  • Transcat, Inc.
  • $38.56
  • Integrated Packaging Solutions
  • XANO Industri AB (publ)
  • $21.00
  • U.S. BulkSak Businesses of Sonoco Products Company
  • Undisclosed Buyer
  • $20.81
  • Business Assets of Specline, Inc.
  • RBC Bearings Incorporated
  • $18.70
  • Mansfield Engineered Components, Inc.
  • Sabaf S.p.A.
  • $10.50
  • Napps Technology Corporation
  • Modine Manufacturing Company
  • $5.30
  • American Seating Company Inc.
  • Hewitt Outsourcing Services India, Ltd.
  • $3.19
  • Assets of KC Machine, LLC
  • Butler National Corporation
  • $2.90
  • Heisey Mechanical, Ltd.
  • Cemtrex, Inc.
  • $2.40

 

Source S&P Capital IQ as of 10/11/2023 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. Domonoske, Camila. "UAW once again expands its historic strike, hitting two of the Big 3 automakers." NPR, 29 Sept. 2023.
  2. 2. Lee, Anne Marie. "Why is the UAW on strike?" MONEYWATCH, 19 Sept. 2023.
  3. 3. "US Manufacturing PMI Tops Forecasts." Trading Economics, 22 Sep. 2023.
  4. 4. Lassa, Todd. "Vehicle Sales Are Up This Year While EV Prices Are Falling.", AutoWeek, 27 September, 2023.
  5. 5. Reed, Stanley. "Oil Prices ‘Melt Up’ in a March Toward $100 a Barrel." The New York Times, 27 Sept. 2023.
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