FORT VALLEY, Ga.--(BUSINESS WIRE)--
Blue Bird Corporation (Nasdaq: BLBD), the leading independent designer
and manufacturer of school buses, announced today that an affiliate of
American Securities LLC has agreed to purchase from Traxis Group B.V
(Traxis), an affiliate of Cerberus Capital Management, L.P. (Cerberus),
its entire equity stake in Blue Bird, which equals 12 million shares of
common stock or approximately 57% of Blue Bird’s outstanding shares of
common stock. Following the completion of the transaction, American
Securities will become the controlling shareholder of Blue Bird.
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The transaction will be executed in two tranches. The first tranche,
which is expected to close on or around June 3, 2016, will include seven
million shares at a price of $10.10 per share. The second tranche, which
is expected to close promptly after Blue Bird’s credit agreement is
amended, will include five million shares at a price of $11.00 per
share. Each closing is subject to certain conditions precedent,
including certain changes to the composition of the Board of Directors
and, in the case of the second closing, an amendment to Blue Bird’s
credit agreement relating to the transaction.
“We are extremely pleased to partner with Phil Horlock and the Blue Bird
management team,” said Kevin Penn, a Managing Director of American
Securities. “We have admired Blue Bird’s focus on operational execution,
growth and profitability for some time and we think the company is
well-situated to build upon its current market position. Blue Bird is a
company with an iconic brand and quality workforce that is truly a
leader in the school bus business. We believe it is a great long-term
investment and are excited about the next chapter of growth together.”
“Cerberus is proud to have contributed to Blue Bird’s strong turnaround
since we initially acquired it in 2006,” said Dev Kapadia, Managing
Director of Cerberus. “Blue Bird has been a terrific investment for
Cerberus with EBITDA improving from a loss-making level at the time of
acquisition in 2006 to a projected $72-$75 million for 2016. Under the
present management team, we have seen Blue Bird bus sales grow from
6,525 units in 2011 to a projected 10,800-11,000 units this year. This
increase results in substantial top-line revenue growth of at least 70%
over the same period, from $566 million to a projected $960-980 million
in 2016. American Securities will be a great partner for Blue Bird going
forward as it continues to grow its business.”
“We are happy to see a firm like American Securities take a major
ownership position in Blue Bird,” said Phil Horlock, Blue Bird President
and CEO. “They have an outstanding reputation in the marketplace and we
welcome them as a new Blue Bird shareholder. I would also like to thank
Cerberus for their support of Blue Bird over the years, and particularly
recognize our Chairman since 2009, Chan Galbato, for his contributions.
Cerberus was instrumental in helping us transform the business and drive
significant improvement in sales and profitability. Blue Bird will
continue to deliver innovative, efficient, high-quality products that
customers want and value. We look forward to maintaining our growth
momentum as we build, sell and service the world’s finest school bus.”
Blue Bird is a party to the purchase and sale agreement, and certain
registration rights currently held by Traxis will be transferred to the
purchaser. In addition, Blue Bird, American Securities and the purchaser
have entered into an agreement with respect to certain governance
matters and activities following consummation of the transactions
contemplated by the purchase and sale agreement.
About American Securities
American Securities is a leading U.S. private equity firm with
approximately $15 billion under management. Based in New York with an
office in Shanghai, American Securities invests in market-leading North
American companies with annual revenues generally ranging from $200
million to $2 billion and/or EBITDA of $50 million to $200 million. For
more information, please visit http://www.american-securities.com.
About Cerberus Capital Management, L.P.
Cerberus is one of the world’s leading private investment firms. Founded
in 1992, Cerberus has excelled at distressed investing since its
inception and has built a highly regarded reputation for its focus on
deep value.
Cerberus and its affiliates manage approximately $31 billion for many of
the world’s most respected investors, including government and private
sector pension and retirement funds, charitable foundations and
university endowments, insurance companies, family offices, sovereign
wealth funds and high net worth individuals. Cerberus directs its global
investment strategies from its headquarters in New York City, and draws
on the expertise of a network of advisory offices throughout the United
States, Europe, and Asia.
About Blue Bird Corporation
Blue Bird is the leading independent designer and manufacturer of school
buses, with more than 550,000 buses sold since its formation in 1927 and
approximately 180,000 buses in operation today. Blue Bird’s longevity
and reputation in the school bus industry have made it an iconic
American brand. Blue Bird distinguishes itself from its principal
competitors by its singular focus on the design, engineering,
manufacture and sale of school buses and related parts. As the only
manufacturer of chassis and body production specifically designed for
school bus applications, Blue Bird is recognized as an industry leader
for school bus innovation, safety, product
quality/reliability/durability, operating costs and drivability. In
addition, Blue Bird is the market leader in alternative fuel
applications with its propane-powered and compressed natural gas-powered
school buses. Blue Bird manufactures school buses at two facilities in
Fort Valley, Georgia. Its Micro Bird joint venture operates a
manufacturing facility in Drummondville, Quebec, Canada. Service and
after-market parts are distributed from Blue Bird’s parts distribution
center located in Delaware, Ohio.
Forward Looking Statements
This press release includes forward-looking statements within the
meaning of the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements relate
to expectations for future financial performance, business strategies or
expectations for our business. Specifically, forward-looking statements
include statements in this press release regarding guidance,
seasonality, product mix and gross profits and may include statements
relating to:
-
Inherent limitations of internal controls impacting financial
statements
-
Growth opportunities
-
Future profitability
-
Ability to expand market share
-
Customer demand for certain products
-
Economic conditions that could affect fuel costs, commodity costs,
industry size and financial conditions of our dealers and suppliers
-
Labor or other constraints on the Company’s ability to maintain a
competitive cost structure
-
Volatility in the tax base and other funding sources that support the
purchase of buses by our end customers
-
Lower or higher than anticipated market acceptance for our products
-
Other statements preceded by, followed by or that include the words
“estimate,” “plan,” “project,” “forecast,” “intend,” “expect,”
“anticipate,” “believe,” “seek,” “target” or similar expressions
These forward-looking statements are based on information available as
of the date of this press release, and current expectations, forecasts
and assumptions, and involve a number of judgments, risks and
uncertainties. Accordingly, forward-looking statements should not be
relied upon as representing our views as of any subsequent date, and we
do not undertake any obligation to update forward-looking statements to
reflect events or circumstances after the date they were made, whether
as a result of new information, future events or otherwise, except as
may be required under applicable securities laws. The factors described
above, as well as risk factors described in reports filed with the SEC
by us (available at www.sec.gov),
could cause our actual results to differ materially from estimates or
expectations reflected in such forward-looking statements.
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For American Securities:
Prosek Partners
Caroline
Harris-Gibson, 212-279-3115, ext. 222
[email protected]
or
Sam
Reinhardt, 212-279-3115, ext. 244
or
For Cerberus Capital
Management:
The Glover Park Group
Caroline Langdale,
646-495-2700
[email protected]
or
Andrew
Johnson, 646-495-2700
[email protected]
or
For
Blue Bird:
Blue Bird Corporation
Jeff Merten, 478-822-2496
Investor
Relations & New Business Development
[email protected]
Source: Blue Bird Corporation and American Securities LLC and Cerberus Capital Management, L.P.