The parent company of Fond du Lac-based Mercury Marine will buy the global marine and mobile business of Menomonee Falls-based Power Products for $910 million in cash in a deal announced Friday.
Brunswick Corp. entered a definitive agreement with San Francisco-based private equity firm Genstar Capital, which owns Power Products. Genstar will retain Power Products’ electrical construction and maintenance, including the Gardner Bender, Bergen and King brands.
The deal is expected to close in the third quarter of the year, at which time Power Products would become part of Mercury Marine’s global parts and accessories business. Mercury will retain the global marine and mobile management team and staff as well as its business support structure and locations, including the Menomonee Falls headquarters, according to Lee Gordon, Mercury Marine director of global public relations and communications.
“The employees will transition over to Mercury/Brunswick over the next few months.,” Gordon said in an email. “They will remain within their current structure but will collaborate with Mercury/Brunswick employees as we have very complementary product lines.”
The company has around 620 employees with roughly 120 based in Menomonee Falls.
Power Products provides battery and power management and digital switching products to marine and other recreational and specialty vehicle markets. It also manufactures marine and transportation accessories. Brunswick and Mercury Marine will add 11 brands, including Ancor, BEP, Blue Sea Systems, Czone, Del City, Lenco Marine, Marinco, Mastervolt, Park Power, Progressive Industries, and ProMariner.
“Many of their products are highly complementary to Mercury Marine’s current P&A portfolio, with no overlap,” said Mercury Marine President John Pfeifer. “The addition of these sophisticated electronics solutions to Mercury Marine’s P&A portfolio will enable the combined operation to provide our customers with a wider array of unique, enhanced solutions, which will enhance our P&A business.”
Parts and accessories accounted for about $1.3 billion in revenue for Brunswick in 2017. Power Products would add about $230 million in revenue for the company.
“Our marine strategy aims to better serve customers and drive value through enhanced sales and service to the broad and growing installed base of boats and engines,” said Mark Schwabero, Brunswick chairman and chief executive officer. “We plan to leverage the unique expertise of each brand to generate revenue and operating synergies and promote growth for both Mercury Marine and Power Products with our broad, combined product portfolio.”
Genstar acquired Power Products in March 2017 from Sentinel Capital Partners. Speaking to analysts on Friday, Brunswick executives declined to say if the company considered acquiring the firm at that time, but noted the deal structure is different with Genstar retaining the electrical construction and maintenance business.
“After having worked with CEO David Scheer and his team over the past 18 months to build out and expand the Power Products business, we are pleased that Brunswick recognizes the strength of the Global Marine and Mobile business as well as its future potential,” said Rob Rutledge, Genstar managing director.
Scheer added: “We have worked closely with Genstar to build our marine and mobile business through new product innovation, added acquisitions that dramatically enhanced our global scale, and launched an integrated systems business to deliver value-add design and engineering services to our marine and vehicle OEM customers.”
