Kaman Corporation on June 26 announced it will sell its distribution segment to affiliates of Littlejohn & Co., LLC (Littlejohn) for $700 million. The transaction value represents a multiple of 10.4 times trailing twelve-month Segment Adjusted EBITDA for the distribution segment.
“For Kaman, this transaction represents an important milestone in our portfolio transformation and the culmination of a thorough strategic review undertaken by our board of directors,” says Neal J. Keating, chairman, president and CEO. “Our strengthened balance sheet will better position the company to invest in and build our higher margin, higher growth aerospace and engineered products businesses to enhance shareholder value.”
Kaman’s distribution segment distributes more than 6 million items, including electro-mechanical, bearings, power transmission, motion control and electrical and fluid power components, as well as automation and MRO supplies, to customers in virtually every industry. In addition, the business provides engineering, design and support for automation, electrical, linear, hydraulic and pneumatic systems as well as belting and rubber fabrication, customized mechanical services, hose assemblies, repair, fluid analysis and motor management, according to the company. With approximately 220 locations across the U.S. and Puerto Rico, the segment’s 2,200 employees generated $1.1 billion in net revenue in 2018.
“Kaman Distribution builds upon Littlejohn’s deep expertise investing in the distribution and industrial sectors,” says Tony Miranda, managing director of Littlejohn. “We have long admired Kaman Distribution, a market-leading provider of products and solutions to its customers as well as a trusted partner to its suppliers, and look forward to working closely with management to further invest in the business and drive growth, both organically and via acquisition."