Patrick Industries, Inc. signed a definitive agreement to acquire Sportech, LLC for approximately $315 million. The transaction is expected to close on or before January 24 and is subject to customary closing conditions and regulatory approval.

Monomoy Capital Partners previously acquired Sportech in 2019.

Sportech, based in Elk River, MN, is a designer and manufacturer of component solutions to powersports OEMs, adjacent market OEMs and the aftermarket, including integrated door systems, roofs, canopies, bumpers, windshields, fender flares, and cowls. With a focus on supplying components to the power sports industry, particularly the utility vehicle market, Sportech recorded an estimated calendar year 2023 revenue of approximately $255 million, resulting in a five-year compound annual growth rate of 17 percent. The acquisition is expected to be immediately accretive to profit margins and net income per share.

“We are delighted to welcome Sportech’s Chief Executive Officer, Jim Glomstad, and the entire Sportech team to the Patrick family,” said Andy Nemeth, CEO of Patrick Industries, Inc. “Sportech’s long history of passion-driven innovation, profitable growth and excellent customer service, along with its strong culture, is a great fit with our outdoor enthusiast vision and brand-forward go-to-market strategy. Sportech provides meaningful scale as a supplier of key and synergistic solutions to powersports OEMs, many of which Patrick has established relationships with through our RV, marine, and existing powersports businesses. Sportech offers a solid platform for future organic and strategic growth within the powersports market, enabling us to continue to accelerate our momentum in the attractive Outdoor Enthusiast space, where we have industry-leading platforms in the RV and marine markets and see a clear pathway to revenue and cost synergies. We look forward to supporting Sportech’s team as they continue to focus on what they do best.”

Jim Glomstad commented, “The team at Sportech and I are excited to join the Patrick family of incredible brands and leverage their foundation of resources and support as we continue to implement our strategy to ‘Discover, Design, Develop and Deliver’ for our valued customers. We are confident we can continue to build on our current relationships and expand the portfolio of products and solutions we offer in partnership with our OEM customers while increasing our market share and becoming a valued contributor to Patrick’s vision for its Outdoor Enthusiast ecosystem.”

Acquisition Highlights

  • Patrick Industries will acquire all outstanding equity of Sportech, LLC, through a wholly owned subsidiary, for $315 million. The all-cash transaction will be funded with a combination of borrowings under the company’s existing credit facility and cash-on-hand.
  • The acquisition of Sportech is expected to be immediately accretive to profit margins and net income per share.
  • The transaction is expected to close on or before January 24, 2024, subject to customary closing conditions, including regulatory approval.
  • As calculated per the credit agreement, the Proforma net leverage ratio at closing is expected to approximate 2.9x, with the Company focusing on reducing its net leverage ratio to pre-acquisition levels within the next two to three quarters.

Following closing, Sportech will continue its operations as a wholly-owned subsidiary of Patrick Industries under the Sportech name and within its existing facilities.

Image courtesy Monomoy Capital Partners