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Thu August 31, 2023
Titan Machinery
Titan Machinery Inc., a leading network of full-service agricultural and construction equipment stores, announced that it has entered into a definitive purchase agreement to acquire J.J. O'Connor & Sons Pty. Ltd., the largest Case IH dealership group in Australia, for $63 million in cash, subject to final working capital and other closing adjustments.
In the unaudited full fiscal year period ended June 30, 2023, O'Connors generated revenue of $258 million and EBITDA of $21.4 million, as translated to USD.
O'Connors, founded in 1964, is the largest Case IH dealership group in Australia, and a market leader in high horsepower equipment. O'Connors delivers a wide range of new and used equipment, parts and services through its 15 dealerships and one parts location located in the Australian southeastern grain belt, which includes the regions of Victoria, New South Wales and South Australia.
In addition, O'Connors is a distributor of more than 25 leading short-line equipment brands, providing an impressive range of complementary offerings to its core Case IH line of products, and has a strong parts and service business that provides a reliable recurring revenue stream.
On a consolidated basis, O'Connors achieved a gross margin of approximately 18.7 percent in the full fiscal year 2023, and generated a total pre-tax margin of approximately 7.2 percent, representing a margin profile that is consistent with Titan's.
David Meyer, Titan Machinery's chairman and chief executive officer, stated, "We are pleased to announce our definitive agreement to acquire O'Connors, Australia's leading Case IH dealership group. This transaction marks our entry into the Australian agriculture market, as we continue to seek opportunities for Titan to expand its reach, both domestically and abroad. O'Connors' operating metrics, core values and customer-centric focus align with our own, making them a great partner for our entry into the Australian agriculture market, which is benefiting from strong fundamentals that are being driven by enhanced productivity, economies of scale and farmer profitability.
"We are very impressed with the O'Connors senior management team, led by CEO Gareth Webb, who have been operating the business exceptionally well over the last five years after succeeding the retiring major shareholders Dennis and Mark O'Connor. It's this strong management team, along with their great track record of retailing and supporting the high horsepower CaseIH product line up that makes this a very compelling acquisition.
"O'Connors has established itself as a respected leader in the region, earning a reputation for its deep expertise and employee and customer-centric focus. Their long-term business relationships, built over nearly six decades, demonstrates their commitment to excellence.
"The O'Connors team has a proven track record of driving organic growth, M&A execution and profitability, and we believe that there is additional opportunity to build upon their growth formula and capitalize on operational synergies across Titan's global footprint as we integrate the business."
For more information, visit www.titanmachinery.com.