Rbc Bearings Incorporated · NYSE:RBC
Rbc Bearings — Merger or Acquisition (July 2021)
18 slides from Rbc Bearings's merger presentation, Jul 26, 2021
Slide 1: RBC Bearings Announces Agreement to Acquire DODGE
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 1 RBC Bearings Announces Agreement to Acquire DODGE July 26, 2021
Slide 2: Safe Harbor Statement for Forward-Looking Statements
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 2 2 Safe Harbor Statement for Forward - Looking Statements This document contains “forward - looking statements” within the meaning of the safe harbor provisions of the U . S . Private
Slide 3: Today's Presenters
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 3 3 Today’s Presenters Dr. Michael J. Hartnett Chairman, President and Chief Executive Officer Daniel A. Bergeron Director, Vice President and Chief Operating Officer Robert M. Sullivan
Slide 4: Agenda
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 4 4 Agenda Transaction Summary Introduction to DODGE Strategic Rationale Financial Impact and Financing Plan Q&A Session
Slide 5: RBC Bearings Incorporated. All rights reserved . • Transaction creates a leading manufacturer with
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 5 5 • Transaction creates a leading manufacturer with strong brand recognition for premium performance critical bearing and motion control products sold to both OEMs and the industrial
Slide 6: Transaction Overview
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 6 6 Transaction Overview Acquisition Price • Enterprise Value of $2.9 billion • Implies 10.6x to 11.9x Adj. EBITDA for the LTM period as of Jun - 2021, when including estimated run - ra
Slide 7: Overview of DODGE
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 7 7 Distributors 77% Channel OEM 16% Direct OEM 23% Overview of DODGE • Leading manufacturer of mechanical power transmission products with market - leading brand recognition • LTM J
Slide 8: RBC Bearings Incorporated. All rights reserved . Doubles Revenue¹ $609mm $617mm Attractive Profitability¹ $174mm
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 8 8 Doubles Revenue¹ $609mm $617mm Attractive Profitability¹ $174mm / 29% $174mm / 28% Low Capital Intensity (Capex as % of revenue) ~3% ~3% Stable Recurring Revenue Base (Aftermarket a
Slide 9: DODGE's Comprehensive Suite of Products
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 9 9 DODGE’s Comprehensive Suite of Products DODGE manufactures a complete line of mounted bearings, enclosed bearing and power transmission components across diverse set of end markets
Slide 10: Significantly Enhances Scale
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 10 10 Significantly Enhances Scale Adj. EBITDA 1 and Margin Net Sales 1 Highly strategic transaction significantly enhances RBC’s scale and margin profile Target mid - 30% Adj. EBITDA m
Slide 11: Continuing a Track Record of Growth
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 11 11 ($ M ) Net Sales Fiscal Year Ended March . | --------------------------------------------------------- 8% CAGR (excl. DODGE) 1 ----------------------------------------------------
Slide 12: Diversifies RBC's Business Mix
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 12 12 Diversifies RBC’s Business Mix Current Revenue by End Market Pro Forma Revenue by End Market Industrial 42% Aerospace 58% $0.6bn $1.2bn Based on FY21 Revenues • Construction & M
Slide 13: Acquisition Aligns With Our Strategic Objectives
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 13 13 Acquisition Aligns With Our Strategic Objectives The acquisition of DODGE results in opportunities to increase penetration within new and existing markets Distribution x x Constru
Slide 14: Key Milestones
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 14 14 Key Milestones Public Announcement x Closing expected in Q4 2021 (calendar ) Bridge Financing Secured x Regulatory Filings Completed Equity Offering Debt Financing
Slide 15: Significant Cash Flow to Drive Deleveraging
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 15 15 Significant Cash Flow to Drive Deleveraging Total Net Debt / Pro Forma LTM Adj. EBITDA ($mm) • 100% Cash consideration, financed with cash on hand, debt and equity • Bridge facili
Slide 16: Summary of Transaction Benefits
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 16 16 Summary of Transaction Benefits • Creates a leading manufacturer with strong brand recognition for premium performance critical bearing and motion control products • Highly comple
Slide 17: Appendix
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 17 17 Appendix
Slide 18: Reconciliation of Non-GAAP Financial Measures
PRIVATE & CONFIDENTIAL Contains RBC Proprietary Information ©2021 RBC Bearings Incorporated. All rights reserved . 18 18 Reconciliation of Non - GAAP Financial Measures $ in thousands RBC Bearings Incorporated FY 2021 Reconciliation of Adjusted EBITDA: Reported operating income $111,458 Cyber event