Holley is merging with a specialized acquisition company in a deal that would value the automotive aftermarket systems provider at about $1.55 billion, the companies said.
Holley is controlled by private equity firm Sentinel Capital Partners and partners with SPAC.
Empower Ltd.
EMPW 0.40
to make it public. Sentinel would become the largest shareholder in the combined company if the deal closes. The estimate of about $1.55 billion includes debt.
Holley manufactures and distributes components such as fuel injection systems, carburetors, engine products and exhaust systems for high performance vehicles. The Bowling Green, Kentucky-based company sells to car and truck enthusiasts to customize their vehicles with brands like MSD, Flowmaster and Accel.
This is a very passionate company, Holly, CEO.
Tom Tomlinson.
said in the interview.
Founded more than 115 years ago, Holley generated net sales of approximately $580 million in 2020, up more than 25 percent from the previous year. This would be one of the few companies to enter the market through a SPAC that has been around for decades and has existing sales. Many other SPAC mergers are related to futuristic themes such as space travel and green energy.
This is a real company with a real engine and real growth potential, he said.
Matt Rubel,
Empower’s CEO and former retail executive.
SPACs are publicly traded shell companies whose purpose is to acquire a private company and offer it to the public. The private company is then given a SPAC position on the stock exchange. SPACs, also known as blank check companies, have become the hottest trend in the financial world. This year, about five a day have been created, with the support of celebrities like singer Ciara.
This year, 70 mergers have already been announced as of Wednesday. The total value of the companies exceeds $175 billion, already surpassing last year’s record of $150 billion, according to Dealogic.
At its IPO last year, Empower raised $250 million from private equity firm MidOcean Partners. In addition to that money, Holley is raising $240 million in a funding round called Private Equity Investments, or PIPE, led by Wells Capital Management and Wasatch Global Investors. There is also a US$50 million forward purchase agreement with the MidOcean Fund.
Holley was sold to Sentinel in 2018 by private equity firm Lincolnshire Management. In 2013, Lincolnshire bought Holley from another private company, Monomoy Capital Partners.
The transaction is expected to close in the second quarter. Holly will then trade under the ticker HLLY.
Send an email to Amrita Ramkumaru at [email protected].
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Published in the print edition of 12. March 2021: Holley auto parts company to merge with SPAC.
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