Andlauer Healthcare Group acquires 100% of Skelton Canada and 49% of Skelton USA
by CM Staff
The Skelton Companies will join AHG's comprehensive platform of dedicated healthcare supply chain solutions and continue to operate independently.
TORONTO — Andlauer Healthcare Group Inc. announced on Feb. 23 that it had entered into definitive agreements to acquire 100% of Skelton Canada Inc. and 49% of Skelton USA Inc. for total aggregate consideration of approximately C$114.7 million, subject to customary working capital adjustments. The agreement also includes an option for AHG to acquire the remaining 51% of Skelton USA. AHG expects the Acquisitions to be immediately accretive to cash flow and earnings per share. The Skelton Companies are specialized in the transportation of refrigerated healthcare products.
Since it was founded in 1962, Skelton Canada has grown to be a transportation partner to the Canadian pharmaceutical and biologics industry, with nationwide reach and a fleet of approximately 100 vehicles and 120 trailers offering validated temperature control, state-of-the-art security systems and real-time shipment monitoring. Skelton Canada also provides cross-border services into 32 U.S. states from its terminals in Toronto and Montreal. Skelton Canada generated approximately C$11 million of EBITDA in calendar 2020 with margins comparable to AHG.
As a result of pharmaceutical customers “pulling” Skelton USA into the domestic U.S. market, the company has been growing rapidly through successfully leveraging the Skelton Companies’ reputation and brand for cold chain expertise. Skelton USA’s fleet of approximately 70 tractors and 90 trailers currently serves customers in California, Illinois, Indiana, Georgia, North Carolina and Pennsylvania. Skelton USA generated approximately C$2.5 million of EBITDA in calendar 2020 with significant year-over-year growth but at a lower margin relative to AHG or Skelton Canada.
“We are delighted to welcome the Skelton team to Andlauer Healthcare Group,” stated Michael Andlauer, Chief Executive Officer of AHG. “Skelton Canada is one of Canada’s leading specialized transportation providers in 2°C to 8°C shipments, and this acquisition will significantly expand our capacity in this area. Our acquisition of a minority interest in Skelton USA allows us to strategically enter the U.S. market by partnering with an existing, well-established operator. I am excited to have the opportunity to continue the Skelton Canada brand and legacy under the AHG umbrella. Skelton shares the same values, the same deep commitment to the customer, and the same commitment to one another as we do at Andlauer Healthcare.”
The Skelton Companies will join AHG’s comprehensive platform of dedicated healthcare supply chain solutions and continue to operate independently led by President, North America, Ron Skelton and Vice President, Mike Skelton.
