has completed its previously announced acquisition of National Pump for a combined asset purchase price of about $780 million. The price was comprised of about $765 million in cash, funded through newly issued unsecured debt, and about $15 million in stock.
The transaction structure provides for additional cash consideration based on the achievement of certain financial targets. The stock consideration has been granted as awards to certain new employees in the form of unregistered restricted shares.
The acquisition makes United Rentals the second largest provider of pump rentals in North America, the company said. The sector is fast growing and provides strong margins. The assets acquired include 37 branch facilities operating in the United States and Canada.
“We’ve now gained a strong entry into the highly attractive business of pump rentals,” said Michael Kneeland, United Rentals president and CEO. “Our acquired operations have the right scale to be a platform for the expansion we envision, which is to double our pump rental revenues within five years while realizing a favorable return on capital. We’re excited to welcome the National Pump employees to United Rentals and to move forward with cross-selling to our combined customer base.”
United Rentals acquired assets of four entities: National Pump & Compressor Ltd.; Canadian Pump & Compressor Ltd.; GulfCo. Industrial Equipment and LD Services LLC. Centerview Partners and Morgan Stanley & Co. acted as financial advisors to United Rentals, and Catalyst Strategic Advisors acted as financial advisor to National Pump.
Based in Stamford, Conn., United Rentals is No. 1 on the RER 100.