Acquisition to Significantly Expand Product Portfolio for Important
Contractor Market
BLOOMINGTON, Minn.--(BUSINESS WIRE)--Oct. 27, 2014--
The Toro Company (NYSE: TTC) today announced that it has entered into a
definitive agreement to acquire the BOSS® professional
snow and ice management business of privately-held Northern Star
Industries, Inc. The transaction is subject to customary closing
conditions, including regulatory approvals, and currently is expected to
close during Toro’s fiscal 2015 first quarter.
Based in Iron Mountain, Michigan, BOSS designs, manufactures and sells
snowplows, salt and sand spreaders, and related parts and accessories,
for light and medium duty trucks, ATVs, UTVs and loaders. BOSS sales in
2014 are anticipated to be approximately $125 million. To learn more
about BOSS, visit www.bossplow.com.
“With the addition of BOSS to our existing market-leading professional
contractor businesses, we are even better positioned to strengthen and
grow our relationships with these important customers by providing them
with the innovative and durable equipment and high-quality service they
need for each season,” said Michael J. Hoffman, Toro’s chairman and
chief executive officer. “We’ve long been interested in the professional
snow and ice management category. We are impressed with BOSS’ solid
business performance and we are optimistic about the opportunities for
growth through product line expansion and in international markets.”
“Through this acquisition, we will gain another strong professional
contractor brand, a portfolio of reliable counter-seasonal equipment,
efficient manufacturing operations and a well-established and broad
North American distribution channel for these products,” said Hoffman.
“In addition, BOSS brings a talented and experienced management team, a
passionate and dedicated team of employees and a culture of innovation
and customer service that is similar to our own.”
“As a privately-held business in a smaller community, it is essential to
us that BOSS transition to a company that not only is well-positioned to
take us to the next level but also shares our commitment to innovation,
customers, employees and the communities in which we live and work,”
said David Brule II, President of BOSS. “We are impressed with Toro, its
rich 100 year history and consistent record of performance. Overall, it
is a great fit for us. On behalf of myself and the entire BOSS team, we
look forward to the next phase of the BOSS journey as part of the Toro
family.”
The purchase price is approximately $227 million, which Toro will pay
primarily in cash except for $30 million that will be paid in the form
of a three-year unsecured promissory note. Toro plans to fund the cash
portion of the purchase price with cash on hand and borrowings under a
new five-year unsecured revolving credit facility that includes a senior
term loan. Toro expects this acquisition to be slightly accretive to
fiscal 2015 earnings.
About The Toro Company
The Toro Company (NYSE: TTC) is a
leading worldwide provider of innovative turf, landscape, rental and
construction equipment, and irrigation and outdoor lighting solutions.
With sales of more than $2 billion in fiscal 2013, Toro’s global
presence extends to more than 90 countries through strong relationships
built on integrity and trust, constant innovation and a commitment to
helping customers enrich the beauty, productivity and sustainability of
the land. Since 1914, the company has built a tradition of excellence
around a number of strong brands to help customers care for golf
courses, sports fields, public green spaces, commercial and residential
properties and agricultural fields. More information is available at www.thetorocompany.com.
LIVE CONFERENCE CALL
October 28, 2014 at 8:00 a.m. CDT
www.thetorocompany.com/invest
The Toro Company will conduct a call and webcast for investors
beginning at 8:00 a.m. CDT on October 28, 2014 to discuss its agreement
to acquire the BOSS snow and ice management business. The webcast will
be available at www.streetevents.com
or at www.thetorocompany.com/invest.
Webcast participants will need to complete a brief registration form and
should allocate extra time before the webcast begins to register and, if
necessary, download and install audio software.
Forward-Looking Statements
This news release contains
forward-looking statements, which are being made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are based on management’s current
expectations of future events, and often can be identified by words such
as “expect,” “anticipate,” “continue,” “plan,” “estimate,” “project,”
“believe,” “should,” “could,” “will,” “would,” “possible,” “may,”
“likely,” “intend,” and similar expressions or future dates. Some of the
forward-looking statements in this release about Toro’s acquisition of
the BOSS business include the anticipated timing for the consummation of
the acquisition, plans for funding the acquisition purchase price and
anticipated earnings impact. Forward-looking statements involve risks
and uncertainties that could cause actual results to differ materially
from those projected or implied. The following are some of the factors
known to Toro that could cause Toro’s actual results to differ
materially from what Toro has anticipated in its forward-looking
statements: delays in completing the acquisition of the BOSS business
and the risk that the acquisition may not be completed at all; the
failure by Toro to achieve the net sales, earnings, working capital,
capital expenditure, growth prospects and any cost or revenue synergies
expected from the acquisition or delays in the realization thereof;
delays and challenges in integrating the businesses after the
acquisition is completed, including risks associated with information or
financial systems; operating costs and business disruption during the
pendency of and following the acquisition, including adverse effects on
employee relations or retention or on business relationships with third
parties, including customers, distributors and dealers; loss of key
personnel; violation of non-competition covenants by key individuals of
the BOSS business; damage to the BOSS business facilities located in
Iron Mountain, Michigan causing a material disruption to the operations;
failure to comply with applicable international, federal or state
product safety or other regulatory standards or requirements;
unanticipated liabilities or exposures associated with the BOSS business
for which Toro has not been indemnified or may not recover; infringement
of intellectual property rights of others associated with the rights
acquired in the acquisition; general adverse business, economic or
competitive conditions; and other risks and uncertainties described in
our most recent annual report on Form 10-K, subsequent quarterly reports
on Form 10-Q, and other filings with the Securities and Exchange
Commission. We undertake no obligation to update forward-looking
statements made herein to reflect events or circumstances after the date
hereof.
Source: The Toro Company
The Toro Company
Investor Relations
Amy Dahl,
952-887-8917
Managing Director, Corporate Communications and
Investor Relations
amy.dahl@toro.com
or
Media
Relations
Branden Happel, 952-887-8930
Senior Manager,
Public Relations
branden.happel@toro.com
