Zep Completes Acquisition of Ecolab's Vehicle Care Division
Combination creates new platform, "Zep Vehicle Care"
ATLANTA -- Zep Inc., a leading producer and marketer of cleaning and maintenance solutions, has announced that a wholly owned subsidiary of Zep has completed the purchase of the Vehicle Care division of Ecolab Inc., effective Dec. 1, 2012, for approximately $120 million.
The combination of Ecolab's Vehicle Care division with Zep's existing North American Sales & Service vehicle-wash operations and its Niagara and Washtronics fleet-wash operations creates a new platform, "Zep Vehicle Care," representing approximately 13% of Zep's net sales on a pro forma basis.
"The creation of Zep Vehicle Care is an example of our disciplined focus on key markets, like transportation, where we bring unique value and expertise to our customers," said John K. Morgan, chairman, president and CEO of Atlanta-based Zep Inc. "We expect the combination of our respective sales organizations with best-in-class vehicle care solutions will allow us to capitalize on growth opportunities in the $1 billion U.S. vehicle care marketplace in a way that is accretive to earnings. Furthermore, the attractive cash flow generation of our overall business will allow us to focus efforts on quickly reducing debt in a meaningful way."
The Zep Vehicle Care portfolio of brands comprised of Blue Coral, Black Magic, Rain-X, Zep Enviroedge, Niagara National, Washtronics and Armor All Professional includes soaps, polishes, sealants and protectants, detail products, wheel and tire treatments, air fresheners and related equipment.
Zep Vehicle Care will offer its products and services through world-class team of service and support professionals to provide car, truck and fleet wash operators with high-efficacy products for their wash tunnels and retail operations.
In addition, the company entered into a transition services agreement under which Ecolab will continue to provide certain services to the acquired vehicle care business for up to 12 months. Zep, with fiscal year 2012 net sales of $654 million, is a leading producer and marketer of cleaning and maintenance solutions for commercial, industrial, institutional and consumer end markets. Zep's product portfolio includes anti-bacterial and industrial hand care products, cleaners, degreasers, deodorizers, disinfectants, floor finishes, sanitizers and pest and weed control products, as well as high-performance products and professional-grade chemical products for the automotive, fleet maintenance, industrial/MRO supply, institutional supply and motorcycle markets. It markets these products and services under brand names such as Zep, Zep Commercial, Zep Professional, Enforcer, National Chemical, Selig, Misty, Next Dimension, Petro, i-Chem, TimeMist, TimeWick, MicrobeMax, Country Vet, Konk, Niagara National, Washtronics, FC Forward Chemicals, Rexodan, Mykal and a number of private-label brands.
St. Paul, Minn.-based Ecolab's Vehicle Care Division is a leading provider of the vehicle care industry's most recognizable branded commercial cleaners, protectants and related products and accessories to the car wash, convenience store, auto dealership and fleet-wash markets in North America. Its 300 products meet customer needs across all segments of the industry.