What happened: Ritchie Bros. agrees to acquire Rouse Services
Why it matters: Deal offers further insights into industry trends
Ritchie Bros. Auctioneers Inc. (TSX:RBA) is drumming up a sizeable sale for itself.
The Burnaby-based company, best known for facilitating sales of heavy equipment and trucks through live auctions and online bidding, is set to acquire U.S. data intelligence firm Rouse Services LLC for US$275 million ($366 million).
The California company specializes in construction equipment market intelligence, including rental analytics, support for equipment sales and fleet appraisals.
Ritchie Bros. CEO Ann Fandozzi said in an October 29 statement that the combined companies would be able to help customers better understand trends in used equipment and then use that information to better optimize fleet-management decisions.
The sale is still subject to closing conditions.
But if it goes through, Rouse Services would remain based in L.A. for “foreseeable future,” according to Ritchie Bros.
The U.S. firm has 60 employees while its potential Canadian parent company has about 2,250 workers worldwide, including about 550 based in B.C.
Much of the Ritchie Bros. C-suite has shifted to the U.S. since Fandozzi assumed the top job and a seat on the board in January.
She was preceded by another American, Ravi Saligram, who departed the company last year and returned to work in the U.S. as CEO for Newell Brands.
Fandozzi is based in Pennsylvania, according to her LinkedIn profile.
The acquisition deal would see Ritchie Bros. acquire Rouse Services for US$250 million in cash and US$25 million in common stock.
Net income during Ritchie Bros.’ second fiscal quarter decreased 2% to US$53.1 million compared with a year earlier, according to financial results released in August.
Revenue during that same period decreased 1% to US$389.1 million.
Shares were trading $80.65, up 0.61%, at the close of markets.
