Baton Rouge, La.-based H&E Equipment Services last week announced that effective Sept. 1, it completed the previously announced acquisition of all of the capital stock of J.W. Burress Inc., for a formula-based purchase price of approximately $96.0 million, subject to post-closing adjustment and other contingent payments, plus assumed debt of approximately $2.4 million. The company funded the Burress purchase price from available cash on hand and from borrowings available under its senior secured credit facility.
Prior to the completion of the Burress acquisition, the previously announced definitive agreement was amended on Aug. 31, for purposes of calculating the purchase price, and to determine the 12-month trailing EBITDA of Burress and certain non-Hitachi indebtedness of Burress as of June 30. Previously, the 12-month trailing EBITDA and non-Hitachi indebtedness were to be determined as of Feb. 28. Hitachi owed indebtedness of Burress continues to be determined as of the closing date.
Burress is a privately owned construction equipment distributor serving the mid-Atlantic markets from 12 locations. Burress’ principal business activity is the distribution of new and used equipment including parts and service for such equipment, which represents approximately 87-percent of the company’s 2006 audited revenues. Among others, Burress represents Diamond Z, Doosan, Hitachi, Kawasaki, Manitowoc, Grove and Terex.
The purchase price of $96 million (subject to post-closing adjustments), plus assumed debt of approximately $2.4 million, excludes Hitachi. Should Burress continue to represent Hitachi, the Burress shareholders will have the opportunity to receive additional purchase price of about $15.1 million payable over three years. Burress had audited revenues of approximately $172 million for the year ended Dec. 31, 2006. The sale, rental and service of Hitachi products accounted for about 28 percent of audited revenues.
H&E Equipment Services is No. 9 on the RER 100.