MAYVILLE, Wis.--(BUSINESS WIRE)--Mayville Engineering Company, Inc. (NYSE: MEC) (the “Company” or “MEC”), a leading value-added provider of design, prototyping and manufacturing solutions serving diverse end-markets, today announced that it had completed the acquisition of privately held Mid-States Aluminum (“MSA”) on July 1, 2023.
Wisconsin-based MSA is an industry-leading, vertically integrated manufacturer of custom aluminum extrusions and fabrications. MSA offers value-added services that include design, engineering, extrusions, fabrication, anodizing and finishing, assembly, and packaging. With MSA, MEC secures an attractive entry-point within light-weight materials fabrication, while providing significant new cross-selling opportunities with both new and existing customers.
“This immediately accretive acquisition, excluding transaction costs, accelerates our entry into high-value, light-weight materials fabrication, consistent with the commercial growth strategy outlined in our MBX value creation framework,” said Jag Reddy, President and Chief Executive Officer. “With MSA, we’ve joined forces with another talented team whose commitment to value creation is closely aligned with our own, as demonstrated by their consistent track record of innovation, performance excellence and profitable growth. We look forward to a seamless integration process, one guided by a collaborative focus on delivering exceptional quality, service and unparalleled value to our combined portfolio of world-class customers.”
As previously disclosed, for the full-year 2022, MSA recorded total revenue and Adjusted EBITDA of approximately $86 million and $16 million, respectively, resulting in an Adjusted EBITDA margin of more than 18%. At closing, the transaction was immediately accretive, excluding transaction costs, to MEC’s earnings per share, Adjusted EBITDA and free cash flow. Based on current expectations and market conditions, the Company expects that the MSA acquisition will contribute between $30 to $35 million of net sales and between $4 to $6 million in Adjusted EBITDA for the fiscal year 2023.
ABOUT MAYVILLE ENGINEERING COMPANY
Founded in 1945, Mayville Engineering Company (MEC) is a leading U.S.-based, vertically-integrated, value-added manufacturing partner providing a full suite of manufacturing solutions from concept to production, including design, prototyping and tooling, fabrication, coating, assembly and aftermarket components. Our customers operate in diverse end markets, including heavy- and medium-duty commercial vehicles, construction & access equipment, power sports, agriculture, military and other end markets. Along with process engineering and development services, MEC maintains an extensive manufacturing infrastructure with 20 facilities across seven states. These facilities make it possible to offer conventional and CNC (computer numerical control) stamping, shearing, fiber laser cutting, forming, drilling, tapping, grinding, tube bending, machining, welding, assembly, and logistic services. MEC also possesses a broad range of finishing capabilities including shot blasting, e-coating, powder coating, wet spray and military grade chemical agent resistant coating (CARC) painting.
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements that reflect plans, estimates and beliefs. Such statements involve risk and uncertainties. Actual results may differ materially from those contemplated by these forward-looking statements as a result of various factors. Important factors that could cause actual results or events to differ materially from those expressed in forward-looking statements include, but are not limited to: macroeconomic conditions, including inflation, rising interest rates and recessionary concerns, as well as ongoing supply chain challenges, labor availability and cost pressures, and the COVID-19 pandemic, have had, and may continue to have, a negative impact on our business, financial condition, cash flows and results of operations (including future uncertain impacts); risks relating to developments in the industries in which our customers operate; risks related to scheduling production accurately and maximizing efficiency; our ability to realize net sales represented by our awarded business; failure to compete successfully in our markets; our ability to maintain our manufacturing, engineering and technological expertise; the loss of any of our large customers or the loss of their respective market shares; risks related to entering new markets; our ability to recruit and retain our key executive officers, managers and trade-skilled personnel; volatility in the prices or availability of raw materials critical to our business; manufacturing risks, including delays and technical problems, issues with third-party suppliers, environmental risks and applicable statutory and regulatory requirements; our ability to successfully identify or integrate acquisitions; our ability to develop new and innovative processes and gain customer acceptance of such processes; risks related to our information technology systems and infrastructure; geopolitical and economic developments, including foreign trade relations and associated tariffs; results of legal disputes, including product liability, intellectual property infringement and other claims; risks associated with our capital-intensive industry; risks related to our treatment as an S Corporation prior to the consummation of our initial public offering; risks related to our employee stock ownership plan’s treatment as a tax-qualified retirement plan; and other factors described in “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2022, as such may be amended or supplemented in our subsequently filed Quarterly Reports on Form 10-Q. This discussion should be read in conjunction with our audited consolidated financial statements included in the Company’s previously filed Annual Report on Form 10-K for the year ended December 31, 2022. We undertake no obligation to update or revise any forward-looking statements after the date on which any such statement is made, whether as a result of new information, future events or otherwise, except as required by federal securities laws.