ACPS Automotive owners Towerbrook, Bridgepoint test waters for exit, Macquarie on sellside – sources
13th July 2023
ACPS Automotive’s backers Towerbrook and Bridgepoint have appointed Macquarie to explore exit scenarios for the German automotive supplier, three sources familiar with the situation told Mergermarket.
The vendors are sounding the market and reaching out to potential strategic buyers to assess interest in the towbar and hitch specialist, one of the sources said, adding that a formal sale process could kick off later this year.
ACPS generates around EUR 450m sales and posts EBITDA margins of around 8%, implying an EBITDA in the EUR 35m-EUR 40m range, this source added. The company reported annual sales of around EUR 360m in 2022, according to its website.
A few parties including financial sponsors are expected to look at ACPS, despite it being a cyclical, automotive business, another of the sources said. The company’s appeal among private equity buyers is likely to be limited given the automotive sector’s wider woes, two of the sources said, with one noting that the vendors would nevertheless not rule out approaches from PE firms.
The traction ACPS generates will ultimately depend on the company’s equity story and whether it is growing at a compelling rate, a fourth source familiar said.
In 2021, ACPS reported EUR 16.1m EBITDA on the back of EUR 116.7m revenue, up from around EUR 3.8m EBITDA and EUR 110m revenue in 2020, according to its most recently available filings. For 2022, it forecast revenue growth of around 15%-20%, provided the impact of the Ukraine war and the COVID-19 pandemic on its business was “limited”, the same filings state.
Towerbrook acquired ACPS, then known as Bosal Automotive Carrier and Protection Systems, in 2018 from Belgian automotive supplier Bosal International for an undisclosed sum, according to Mergermarket data.
Bridgepoint (formerly EQT Credit) acquired a stake in ACPS in 2020 as part of a debt-to-equity swap after a restructuring, with Towerbrook remaining the company’s majority owner, as reported by Mergermarket’s sister publication Debtwire. The company was then “badly affected” by factory closures due to the pandemic, as reported.
ACPS has since recovered, has a strong market share in its niche, and is seeing penetration rates take off for some of its products, as they can be used to mount bicycles and e-bikes onto cars, one of the sources said. Its retractable, swivel towbars are its main product and generate most of its revenue at higher margins, the source continued.
Given its focus on towbars, ACPS has no exposure to the combustion engine and is unaffected by the shift to electric vehicles, this source added.
Founded in 1955 near Stuttgart and headquartered in Ingersheim, ACPS is a “technology and market leader” in towbars and hitches for cars, SUVs and vans, according to its website. It has around 2,000 employees.
Distributed under the ORIS brand, its towbars can connect vehicles with caravans, bicycle racks, and boat and horse trailers for private and commercial uses. Its customers are primarily major original equipment automobile manufacturers (OEMs).
Comparable companies in its space in Europe include Brink International, a Dutch towbar specialist, and Westfalia Automotive, a German supplier of towbar systems, one of the sources said.
Brink was acquired by ALOIS KOBER (AL-KO), a subsidiary of US-based automotive supplier DexKo Global, from sponsor H2 Equity Partners in 2021 for an undisclosed sum, according to Mergermarket data.
Macquarie, ACPS and Towerbrook declined to comment. Bridgepoint did not respond to requests for comment.