NEW YORK -- Clayton, Dubilier & Rice LLC and Ingersoll-Rand plc have announced a definitive agreement under which funds managed by CD&R will acquire a 60% ownership stake in Hussmann International Inc., a leading manufacturer of refrigerated display merchandising equipment and refrigeration systems for the retail food industry. CD&R will invest $195 million of equity to acquire convertible participating preferred stock of Hussmann in the transaction. Ingersoll Rand will retain a 40% equity interest in the company.
With 2010 revenues of nearly $800 million, Hussmann [image-nocss] serves a broad range of customer segments involved in food retailing, including supermarkets, mass merchants, warehouse clubs, convenience stores, drug stores and foodservice establishments. The company's products provide value to customers through efficient, reliable and differentiated retail merchandising solutions that drive retailers' sales and profitability. Hussmann holds a leading position in North America, with longstanding relationships with 17 of the 20 largest food retailers, as well as in Mexico and Australia and New Zealand.
Hussmann provides critical solutions to customers in the areas of merchandising, food safety, shelf life extension, sustainability and life-cycle value. The company's products include refrigerated and nonrefrigerated display merchandisers, refrigeration systems, evaporative condensers, heat exchange coils, beverage coolers, walk-in coolers and freezers and other related products. Hussmann also provides installation, service, maintenance and aftermarket parts.
Ingersoll Rand acquired Hussman in 2000.
"Hussmann is a clear market leader with an outstanding reputation, a history of innovation, strong long-term customer relationships, a dedicated work force and significant manufacturing scale advantages," said Nathan K. Sleeper, a partner at CD&R. "These core strengths form a solid foundation from which to build an even more successful enterprise."
James G. Berges, a CD&R Operating Partner who will become Chairman of Hussmann after the transaction closes, said, "We are pleased that Ingersoll Rand will be investing with us. Together with the Hussmann management team, we look forward to taking the company to the next level of profitable growth while continuing to position the business as an industry leader based on innovative customer solutions and commitment to quality."
The transaction is expected to close near the end of the third quarter. CD&R has obtained committed financing from GE Capital, ING Capital LLC, Rabobank, BMO Capital Markets, RBC Capital Markets and Natixis. J
Founded in 1978, CD&R is a private-equity firm with an investment strategy predicated on producing superior financial returns through building stronger, more profitable businesses. The firm's partners and advisors include a combination of skilled investment decision-makers and seasoned corporate leaders from global businesses such as ABB, Allstate, BAE, BBA, BTR, Disney, Dow, Eaton Vance, Emerson Electric, Gap, GE, IBM, Procter & Gamble, Tesco, Unilever and Williams, among others. Since inception, CD&R has managed the investment of approximately $16 billion in 49 U.S. and European businesses with an aggregate transaction value of approximately $80 billion.
Founded in 1906, Bridgeton, Mo.-based Hussmann is a leader in manufacturing, selling, installing and servicing refrigerated display merchandising equipment and refrigeration systems.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.