Milwaukee-based REV Group Inc. has acquired the emergency response vehicle business of Spartan Motors for $55 million in cash.
Spartan ER is a designer, manufacturer and distributor of custom emergency response vehicles, cabs, chassis and complete apparatus for the fire fighting vehicle industry in the U.S., Canada and select South American and Asian markets. It had around $253 million in net revenue for the twelve months ending Sept. 30, 2019 and its backlog represents around 74% of anticipated 2020 sales.
“We are excited to acquire a top North American fire apparatus manufacturer of scale with a well-recognized, innovative and broad product offering, long-standing relationships with dealers and municipal customers, and a growing installed base of over 6,000 vehicles,” said Tim Sullivan, president and chief executive officer of REV Group. “It’s our long-term strategy to continue to grow this segment, as well as continue to establish REV Group as a leader in the innovation of fire apparatus and other emergency response vehicles.”
The deal will expand REV Group’s competitive position in North American fire apparatus across product categories while providing an opportunity to combine the engineering, new product development, footprint, dealer network and customer relationships of the two companies, according to a REV Group investor presentation.
Spartan’s emergency response business has operations in Michigan, South Dakota, Pennsylvania, Nebraska and Delavan, Wisconsin, according to securities filings.
“The divestiture of the ER business unit will give us the speed and flexibility needed to further focus on accelerating growth and profitability in our commercial, fleet, delivery, and specialty vehicle markets where we see the biggest opportunity to generate higher returns,” said Daryl Adams, president and CEO. “By freeing up additional resources and capital to better serve our target markets and make additional strategic investments, we can continue to evolve to meet the needs of our customers and provide long-term value to our shareholders.”
