Aimia to acquire Tufropes for over $249M

TORONTO — Aimia has signed definitive agreements to acquire all of the issued and outstanding shares of Tufropes Pvt Ltd. as well as certain business undertakings of India Nets (together referred to as Tufropes or the Company).

Aimia will pay a purchase price of $249.6 million on a cash-free and debt-free basis, subject to customary adjustments related to net debt and working capital at closing. Transaction closing, which is subject to regulatory approval and other customary closing conditions, is expected to occur before the end of the first quarter of 2023. Paladin Private Equity LLC (Paladin) will act as Aimia’s partner on the transaction.

Through its global sales network and its cost-efficient manufacturing facilities across India, Tufropes is capable of producing 70,000 metric tons of rope and netting solutions per year. It product portfolio includes over 35,000 individual SKUs and is uniquely positioned to capture an increasing share of these attractive end markets. Its revenue is geographically diverse, with its products sold in over 70 countries, with 34 per cent of revenues generated in Europe, 34 per cent in Asia, 20 per cent in the Americas and 12 per cent in Australasia.

A family-owned business founded in 1992, Tufropes is expected to achieve annual revenue of approximately $130 million for the fiscal year ending March 31, 2023, and EBITDA margins of 18 per cent. Based on assumptions such as operational improvement initiatives, as well as the optimization of product mix, EBITDA margins are expected to grow above 20 per cent within the next two years. Since 2001, the company has grown revenue at a compounded annual growth rate of approximately 20 per cent, with limited capital investment requirements and high free cash flow conversion. Upon closing, Aimia intends to add key senior management and sales and marketing positions in Canada and Europe, located near customers and allowing Aimia to use its tax attributes.

“Tufropes represents an outstanding opportunity for Aimia and Paladin to invest in a global market leader, with a long track record of organic growth and strong free cash flow generation, while utilizing Aimia’s sizeable tax attributes to further enhance returns for its stakeholders,” said Phil Mittleman, CEO of Aimia. “The new executive leadership and expanded global sales team will support and grow Tufropes’ long-standing relationships globally. We are excited to be partnering with Paladin Private Equity, whose experience and investment acumen will help Tufropes grow both organically and through potential acquisitions. We also wish to thank the Goel family for over 31 years of stewarding this company through an incredible period of growth and for their help in transitioning the ownership of this company to Aimia.”