Ritchie Bros. announced Wednesday it has completed its acquisition of IronPlanet, for approximately $758.5 million, subject to customary closing adjustments.
Ritchie Bros. says the acquisition was financed through a combination of Ritchie Bros.’ previously announced senior note offering and secured term loan facility. The transaction is expected to be earnings accretive within the first year, excluding acquisition related costs.
The acquisition of IronPlanet accelerates Ritchie Bros.’ strategy of becoming a one-stop, multichannel company where customers can buy, sell or list equipment, when, how and where they choose – both onsite and online. Later this year, Ritchie Bros. says it will combine its online EquipmentOne brand with the IronPlanet DailyMarketplace, creating a harmonized brand offering called Marketplace E that gives customers more ways to set reserve pricing. Ritchie Bros. also gains expanded growth capabilities in the oil and gas and government sectors.
Additionally, the company will be combining the Ritchie Bros. and IronPlanet sales forces in the U.S., Canada and Europe, in line with its strategy to provide customers a one-stop, multichannel experience. Territory and Strategic Account Managers will be positioned as solution sellers and offer customers three main product offerings: RBA integrated unreserved onsite auctions; IronPlanet weekly featured auctions and Marketplace E, an IronPlanet solution. Mascus, Kruse Energy and GovPlanet will continue to remain as stand-alone businesses with stand-alone sales teams, given that they serve specialized customer segments, Ritchie Bros. says.
As a part of this acquisition, Ritchie Bros. also enters into an initial five-year strategic alliance with Caterpillar that is expected to strengthen its relationship with Caterpillar’s independent dealers around the world by providing them enhanced and continued access to a global auction marketplace to sell their used equipment. The company says it also will continue to coordinate and manage Cat auctions in respective Cat dealer geographies.
“We are pleased that the acquisition of IronPlanet has been completed and I am delighted to welcome IronPlanet employees to the Ritchie Bros. family. Our shared passion for serving customers is loud and clear and it will continue to be our guiding light in the unified company,” says Ravi Saligram, CEO at Ritchie Bros.
“Our integration plans have been meticulously worked on during the last nine months: our combined senior management team will be in place Day 1 and our sales forces will be integrated within the first 30 days. In the second half of 2017, we will focus on aligning and unifying the company, optimizing the integration, starting to achieve synergies and getting the organization ready for a fast start in 2018 to deliver growth and add shareholder value.”
Saligram has designed his new organizational structure to maximize growth outcomes by utilizing the complementary skillsets of senior leaders from both companies. All leaders mentioned below report to Saligram unless otherwise mentioned, Ritchie Bros. says.