Boyd Group has effectively acquired a majority ownership and controlling interest in the retail auto glass business of Glass America. The Fund and its existing operating partner will each contribute their interests in their existing US auto glass business (Gerber Glass) on a relative valuation basis, along with a USD 6.75 million cash equity contribution into the new entity and will receive a combined equity interest of 70%.
Boyd Group Income Fund has announced that, through a business combination, it has effectively acquired a majority ownership and controlling interest in the retail auto glass business of Glass America, Inc., which operates 61 retail auto glass locations across 23 US states under the trade names of Glass America and Auto Glass Services.
The Fund and its existing operating partner will each contribute their interests in their existing US auto glass business (Gerber Glass) on a relative valuation basis, along with a USD 6.75 million cash equity contribution into the new entity and will receive a combined equity interest of 70%. Boyd will fund USD 5.75 million of the equity contribution and will hold 55.19% of the new entity, as well as operating and Board control positions. The shareholders of Glass America will contribute the business of Glass America on a relative valuation basis for a 30% non-controlling interest position. The cash equity contributions by Boyd and its operating partner will be used to pay off third party debt of Glass America.
“This acquisition is very attractive from both a strategic and a financial point of view,” said Brock Bulbuck, President and CEO of the Boyd Group. “The automotive glass restoration business is a natural and complimentary extension of our industry leading collision repair business. This acquisition will increase our US glass business size, both in terms of footprint and annual sales, to become the second largest retail auto glass business in the US, servicing 28 states covering approximately 50% of the US population. This retail expansion, in combination with our already established nationwide auto glass network, Gerber National Glass Services, significantly improves our positioning with US insurance company customers. Financially, we expect this acquisition to be immediately accretive to our earnings and cash flow, with significant synergy opportunities available over time as the Glass America operations are integrated into Gerber Glass’s operating model. It will also better position our glass business for growth alongside our growing collision business.”
“We are also pleased with our continuing partnership with our operating partner Eddie Cheskis, CEO of Gerber Glass, who will co-invest with us and will continue as CEO of our much larger US glass business,” added Bulbuck. “While complimentary to our collision business, we also recognize that the auto glass business is somewhat unique and therefore having a recognized industry leader as an operating partner is of great value.”
“Glass America and its investors will benefit from the transaction by ownership in the second largest windshield repair and replacement entity in the United States and participating in the considerable expected revenue and cost synergy benefits arising from joining with Gerber Glass,” added John Teeger, Chairman of Glass America Inc. “Our customers and employees will benefit from the combined regional spread of operations covering a majority of the states of the US, coupled with utilization of the Gerber Glass call centre and the financial strength of the combined entity.”