Generac Holdings Inc. (NYSE: GNRC), a leading designer and manufacturer of back-up power generation products, announced today that one of its subsidiaries has signed a definitive share purchase agreement to acquire from a subsidiary of TT electronics plc all of the shares of Ottomotores UK Limited and its affiliates, including the operations of Ottomotores Mexico and Ottomotores Brazil, (collectively “Ottomotores”) for $46.5 million in cash, subject to certain closing net asset adjustments.
Founded in 1950 and headquartered in Mexico City, Ottomotores Mexico is a leading manufacturer of power generation equipment in Mexico and other parts of Latin America. Ottomotores Brazil, located in Curitiba, recently entered the Brazilian market and has been steadily gaining traction in one of Latin America's fastest growing markets. The combined Ottomotores businesses have more than 500 employees and generated revenues of $81.6 million in fiscal 2011.
“Ottomotores is a terrific strategic fit for Generac’s business, providing immediate scale for our international expansion efforts,” said Aaron Jagdfeld, President and Chief Executive Officer of Generac. “This acquisition is directly in line with our Powering Ahead strategic plan and positions Generac to participate in the significant global market that exists for commercial and industrial backup power generation by offering products tailored to the needs of customers in individual international markets.”
The acquisition of Ottomotores provides a platform for future growth in additional markets outside North America through Ottomotores’ broad product offering of higher output power products and strong, established distribution network.
“We at Ottomotores are very excited about this transaction,” said Francisco Haro, Managing Director of Ottomotores Mexico. “With both companies having a long history in their own markets and deep expertise in the backup power generation business, we believe that there are many synergies and opportunities to grow with the combination of these companies.”
“We welcome the entire Ottomotores team to the Generac family,” said Jagdfeld. “We are looking forward to working closely together with such an experienced management team to create a formidable backup power generation company serving global markets.”