JULY 13, 2017 — Kirby Corporation (NYSE: KEX) today announced the signing of a definitive agreement to acquire substantially all of the assets and businesses of Stewart & Stevenson LLC a subsidiary of the Houston-based Parman Capital Group, for approximately $710 million before post-closing adjustments and transaction fees.
Stewart & Stevenson is a manufacturer and distributor of products and services for the oil and gas, marine, construction, power generation, transportation, mining and agricultural industries.
It is an authorized distributor for Electro-Motive Diesel (EMD) and MTU Marine diesel engines and is a leader in the service, sales, engineering and application support of heavy duty marine engines for the commercial, inland waterways, offshore petroleum, military, and pleasure craft industries
Kirby says it will fund the purchase equally through its revolving credit facility and Kirby common stock valued at approximately $355 million, subject to certain closing adjustments.
The closing of the acquisition is expected to occur in the third quarter and is subject to customary closing conditions.
Kirby Chairman Joseph H. Pyne commented, “The combination of Stewart & Stevenson with Kirby’s existing distribution and services business has the potential to unlock significant strategic value, dampen overall volatility in the business, and create a larger organization at an opportune time, as the industry continues to recover from a deep downturn. We are pleased to welcome the management and employees of a globally-recognized company with 115 years of history. We welcome the support of Parman Capital Group as a major shareholder of Kirby Corporation.”
David Grzebinski, Kirby’s President and Chief Executive Officer, commented, “The acquisition of Stewart & Stevenson significantly expands the geographic footprint and capabilities of our distribution and services business. This transaction creates one of the largest distribution networks in the country with the engineering and technological capacity to successfully address the complex requirements of a large customer base in a competitive national and global environment. In this period of accelerating demand in the pressure pumping and industrial sectors of the economy, Stewart & Stevenson’s leadership in these sectors and its longstanding, close relationships with the world’s major industrial companies provide an excellent opportunity for us to expand our participation in the national and international arenas. We expect this to accelerate diversification of our combined product lines, boost facility utilization and improve productivity.”