Divestiture of Smart Watering Technology Solutions Provider Follows Successful Transformation Program
Sale Adds to Momentum of Platinum Equity's Small Cap Investment Platform
LOS ANGELES, Oct. 26, 2021 /PRNewswire/ -- Platinum Equity announced today the signing of a definitive agreement to sell Orbit Irrigation to Husqvarna Group in a transaction valued at approximately $480 million. Orbit will become part of Husqvarna Group's Gardena Division.
The transaction is expected to close before year-end 2021, subject to customary regulatory approval.
Orbit, based in Salt Lake City, Utah, has approximately 300 employees and generates over 95% of its revenues in North America. The Orbit product offering includes watering equipment sold through retail, garden centers, e-commerce and professional channels. In addition, the company's B-hyve® suite of smart products helps consumers conserve water, promote plant health and save money. Platinum Equity acquired Orbit in February 2019.
The sale is the culmination of a transformation program under Platinum Equity's ownership that prioritized investing in Orbit's smart watering technology, diversifying its product portfolio and implementing operational improvement initiatves throughout the organization. Orbit's revenue increased approximately 75% and the company doubled its pro forma adjusted EBITDA in less than three years.
"Orbit's success is the result of a strong partnership with the company's leadership team and a lot of hard work by dedicated employees at every level of the organization," said Platinum Equity Partner Jacob Kotzubei. "We deployed the full range of Platinum's M&A and operational toolkit in service of transforming the company into an industry leader, and we are proud of everything the company has accomplished."
Expanding Orbit's B-hyve ecosystem, which comprises a comprehensive suite of connected smart water and irrigation management tools, was a core element of the transformation plan. By investing in new B-hyve products, app development and continuous innovation, the total number of B-hyve connected devices has increased from approximately 220,000 in 2019 to more than 1.4 million today.
"Platinum helped Orbit transform from a traditional consumer goods company into an innovative technology provider," said Orbit CEO Stuart Eyring. "They also helped us put the systems and infrastructure in place to facilitate our growth and transition to a true market leader. Today we are well prepared to join forces with Husqvarna Group's Gardena Division, one of the world's leading innovative gardening product brands."
In addition to investing in the company's core product portfolio, Platinum Equity also helped establish a robust M&A pipeline.
In June 2020, Orbit acquired Bond Manufacturing, a manufacturer and distributor of irrigation and garden products, including hose and watering devices.
"It was important to not just invest in Orbit's core product portfolio, but to also diversify the company's revenue streams across customer channels and end-market applications," added Platinum Equity's Nick Fries, who led the Orbit investment for the firm's Small Cap team. "Orbit is now a leading omni-channel provider of water management and gardening solutions, with a very bright future."
Mr. Eyring said the investments Platinum Equity made to transform the company were not only good for business, they were good for the environment.
"Fresh water availability is one of the most vital resource issues facing the world today," said Mr. Eyring. "Expanding the use of smart watering products promotes conservation and more efficient use of natural resources. With over 62 billion gallons saved to date, our comprehensive suite of smart technologies will continue to benefit the environment."
Moelis & Company LLC and William Blair & Company, LLC are serving as financial advisors to Platinum Equity on the sale of Orbit. Gibson, Dunn & Crutcher LLP is serving as legal counsel to Platinum Equity on the transaction.
About Platinum Equity
Founded in 1995 by Tom Gores, Platinum Equity is a global investment firm with more than $25 billion of assets under management and a portfolio of approximately 50 operating companies that serve customers around the world. The firm is currently investing from Platinum Equity Capital Partners V, a $10 billion global buyout fund, and Platinum Equity Small Cap Fund, a $1.5 billion buyout fund focused on investment opportunities in the lower middle market. Platinum Equity specializes in mergers, acquisitions and operations – a trademarked strategy it calls M&A&O® – acquiring and operating companies in a broad range of business markets, including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, telecommunications and other industries. Over the past 25 years Platinum Equity has completed more than 250 acquisitions.
Orbit's mission is to bring smart technology to homeowners, landscape professionals and farmers across the globe. The company serves markets spanning six continents and 40 countries, and for decades has been a worldwide leader in designing and building innovative water optimization products. For more information, visit www.orbitonline.com.
Dan Whelan, Platinum Equity
Mitch Lord, Orbit Irrigation
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SOURCE Platinum Equity