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News » US » Rental business BakerCorp set to change hands » published 3 Jul 2018

Rental business BakerCorp set to change hands

Tank, pump, filtration and trench-shoring rental business BakerCorp is to be bought by United Rentals in a US$715m cash deal.

The boards of directors of both companies have unanimously approved the agreement; the transaction is expected to close in the third quarter of 2018.

BakerCorp provides the rental of tanks, pumps, filtration and trench shoring for a broad range of industrial and construction applications. The company has approximately 950 employees serving more than 4,800 customers in North America and Europe. Operations are primarily concentrated in the United States and Canada, where it has 46 locations, with another 11 locations in France, Germany, the UK and the Netherlands.

For the 12 months ended 31 May, BakerCorp generated US$79m of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) at a 26.9% margin on US$295m of total revenue.

United Rentals said that BakerCorp’s 75-plus years in business have created strong, blue-chip customer relationships in the industrial and construction sectors. The combined company will serve a larger strategic account base with a broader fleet range, including approximately 24,000 units to be acquired at closing. The combination is expected to create significant opportunities for revenue growth and customer service through cross-selling, re-rent conversion and scale.

The integration of BakerCorp into United Rentals will give the acquired locations access to United Rentals’ systems and technology, as well as process and data-driven efficiencies. The combined operations are expected to create approximately US$19m in direct cost synergies across corporate overhead and shared services.

Michael Kneeland, chief executive officer of United Rentals, said: “We’re gaining a terrific team that shares our strong commitment to safety and customer service, and operations that complement our North American pump and trench offerings. This transaction will also be our company’s first experience in Europe, where BakerCorp has established an attractive, fast-growing business with significant future opportunity.”

Bob Craycraft, president and chief executive officer of BakerCorp, added: “I’m extremely proud of what our team has built. The value we’ve delivered for our customers has created this new opportunity to be part of the largest equipment rental company in the world. The combination with United Rentals is an exciting development for the future of both our customers and employees.”

 

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This article was published on 3 Jul 2018 (last updated on 3 Jul 2018).

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