Fox Factory Inc., has signed a definitive agreement to acquire SCA Performance Holdings Inc., an OEM authorized specialty vehicle manufacturer (SVM) for light-duty trucks and SUVs with headquarters in Trussville, AL. The company also said its fourth-quarter and the full-fiscal year 2019 outlook is expected to be slightly above its previous range.
The sellers are Southern Rocky Holdings, LLC, a portfolio company of Kinderhook Industries.
The $328 million transaction, exclusive of vehicle inventory, will be financed through an expanded and syndicated credit facility led by Bank of America. The company also agreed to an additional $13 million of the contingent, performance-based retention incentives for key SCA management payable over the next two years. The transaction is expected to close late in the first quarter of fiscal 2020, subject to customary closing conditions and to be accretive to FOX’s fiscal 2020 financial results.
SCA operates under three aftermarket brands: SCA Performance, Rocky Ridge Trucks and Rocky Mountain Truckworks. The acquisition is complementary to FOX’s Tuscany business, expanding its North American, geographic manufacturing footprint and broadening its product offering in a growing segment of the automotive industry. The combination of Tuscany and SCA, as part of FOX’s branded portfolio of products, provides the Company with a leading market position. Additionally, the acquisition creates an opportunity to add FOX products, including lift kits and suspension components, to SCA’s vehicles.
“We are excited to announce the acquisition of SCA, and believe it presents a substantial opportunity for FOX to further expand its performance-defining aftermarket solutions and continue to drive growth in our Powered Vehicles Group,” stated Mike Dennison, FOX’s chief executive officer. “We look forward to further accelerating our already significant presence in the growing specialty vehicle manufacturing market. We welcome the experienced SCA leadership team and believe they will play an integral part in our company’s growth going forward.”
“The entire SCA management team is thrilled to join FOX. We have tremendous admiration and respect for the FOX brand, leadership, and culture of providing customers with performance-defining products,” stated Michael McSweeney, SCA’s chief executive officer. “As part of FOX, we expect to build upon the success of both companies to further expand our market position and product offerings.”
Fiscal 2019 Guidance Update
For the fourth quarter and full-fiscal year 2019, the company now expects financial results to be slightly above its financial outlook previously provided on October 30, 2019. The company expects to report fourth-quarter and the full-fiscal year 2019 financial results along with the Company’s first-quarter and fiscal 2020 guidance on March 3, 2020.
Fox Factory Holding Corp. designs and manufactures products primarily for bicycles, on-road and off-road vehicles and trucks, side-by-side vehicles, all-terrain vehicles, snowmobiles, specialty vehicles and applications, and motorcycles.
Photo courtesy SCA Performance Holdings Inc.