- The deal excludes Aimia Foods, UK, Portugal, and Israel businesses
- The transaction is expected to close by 31 December
- BDT Capital Partners is an affiliate of BDT & MSD Partners
Culligan International, backed by BDT Capital Partners, has agreed to acquire Primo Water Corporation’s European business.
The transaction is valued at up to $575 million. It provides a premium valuation multiple of around 11x adjusted EBITDA based on trailing twelve months ended 1 July.
The deal excludes Aimia Foods, UK, Portugal and Israel businesses but each of these will be sold across 2024, according to a release.
Primo Water is a sustainable drinking water service provider in North America and Europe. Based in Tampa, Florida, it generated around $2.2 billion in annual revenues in 2022.
Primo Water plans to repay the outstanding balance on its cash flow revolver, with a long-term goal of sustaining adjusted net leverage under 2.5x adjusted EBITDA. An incremental $25 million share repurchase will be authorised, revising the share repurchase authorisation to $75 million upon closing, the release added.
“Looking ahead, we will be laser-focused on growing the North American business, increasing our profitability and margins, enhancing our balance sheet strength, and returning capital to shareowners,” said Tom Harrington, CEO, Primo Water.
The transaction is expected to close by 31 December 2023, subject to regulatory approvals.
BDT Capital Partners is an affiliate of BDT & MSD Partners, a merchant bank based in Chicago.
Culligan is a global consumer water service provider based in Chicago.
BMO Capital Markets Corp is acting as exclusive financial advisor and White & Case is serving as legal advisors to Primo Water.