Loomis AB Expands Offerings through Key Acquisition
Loomis AB has taken a significant leap forward in broadening its service capabilities by acquiring Burroughs, Inc. This strategic move, executed through Loomis' wholly owned subsidiary Loomis US Holding Inc., aims to enhance the company's position in the automated solutions market. The initial acquisition price stands at USD 72 million, representing an essential component of Loomis' strategy to enhance its ATM services.
A Comprehensive Service Provider
Burroughs is recognized as a leading provider of lifecycle management services for ATMs, smart safes, kiosks, and other automated technologies in the U.S. and beyond. With a focus on maintenance services, Burroughs brings a wealth of experience and expertise in the area of payment automation and transaction technology, which includes both digital and on-site support for first- and second-line maintenance.
The company is notably OEM-agnostic, allowing for flexible solutions that cater to a variety of device types. This adaptability ensures that Burroughs can effectively meet the diverse needs of its clients, reinforcing its reputation as a key player in the market.
Strong Industry Presence
With a workforce of around 600 employees, the majority being skilled service technicians, Burroughs established itself as a formidable presence in the industry. In recent reports, the company registered impressive revenues of USD 107 million, illustrating its substantial impact and effectiveness in the marketplace.
CEO Insights
Aritz Larrea, Loomis President and CEO, commented on the acquisition, emphasizing its significance in expanding Loomis' offerings related to ATMs and Automated Solutions. The collaboration is set to not only enhance the full-service ATM solution but also provide existing customers with improved service options while opening up additional market expansion channels.
Larrea expressed optimism that by merging customer bases and optimizing service supply chains, Loomis is well-positioned for robust growth. He stated, "Our adjacent services have significantly contributed to our growth journey, and this acquisition represents a continuation of that trajectory," highlighting the future potential for increased market share.
Financial Details of the Acquisition
The purchase is structured to consist of an initial price of USD 72 million calculated on a cash and debt-free basis, alongside a potential earn-out that may reach a maximum of USD 38 million. This structure is strategically aligned with Loomis' financial objectives, reflecting a 6.5x EV/EBITDA multiple based on adjusted financials for the year-end.
Future Expectations
The acquisition will be financed through available cash and existing credit facilities, with assurances that it will not significantly alter Loomis' leverage profile. As Burroughs integrates within the Loomis' USA segment, it is expected to contribute positively to the group's operating profit and earnings per share over time.
The management team of Burroughs will continue in their current roles to ensure a smooth transition and continued operational success as the integration progresses.
Communications and Next Steps
Loomis is actively encouraging interested parties to engage with the upcoming financial presentations. Aritz Larrea and CFO Johan Wilsby are scheduled to present the company’s first-quarter 2025 results soon, highlighting opportunities for inquiries about the recent acquisition and other operational aspects.
For those seeking further details, Loomis has set up communication channels for stakeholders, ensuring transparency and robust engagement in the company's future directions.
Frequently Asked Questions
What is the goal of Loomis' acquisition of Burroughs?
The primary goal is to enhance Loomis' ATM and Automated Solutions offerings, allowing the company to deliver comprehensive service solutions.
How is the acquisition being financed?
The acquisition will be funded through Loomis' available cash and existing credit lines.
What impact will this acquisition have on Loomis' operations?
The acquisition is expected to positively influence Loomis' operating profit and earnings per share over time.
What is Burroughs known for?
Burroughs is known for providing comprehensive lifecycle management services and maintenance for ATMs and other automated solutions.
Who will remain in charge at Burroughs post-acquisition?
The existing management team of Burroughs will remain in their roles to ensure a seamless integration process.
