{"id":6206,"date":"2016-08-30T16:04:58","date_gmt":"2016-08-30T16:04:58","guid":{"rendered":"http:\/\/minutes.machine.market\/?p=6206"},"modified":"2016-08-30T16:04:58","modified_gmt":"2016-08-30T16:04:58","slug":"ritchie-bros-to-acquire-ironplanet-to-accelerate-its-customer-centric-multi-channel-diversification-strategy","status":"publish","type":"post","link":"https:\/\/machine.market\/blog\/ritchie-bros-to-acquire-ironplanet-to-accelerate-its-customer-centric-multi-channel-diversification-strategy\/","title":{"rendered":"Ritchie Bros. to acquire IronPlanet to accelerate its customer centric multi-channel diversification strategy"},"content":{"rendered":"<ul>\n<li>Increases customer choice; enhances online offerings; provides penetration into large, additional segments<\/li>\n<li>Business combination expected to significantly increase growth in revenue and earnings; effectively uses strength of Ritchie Bros.\u2019 balance sheet<\/li>\n<li>Transaction expected to be accretive to earnings within first year (excluding acquisition-related costs)<\/li>\n<li>Long-term alliance reached with Caterpillar<\/li>\n<li>With more than $US3 billion in annual online equipment sales, the combined company will rank among the world\u2019s top 50 B2B e-commerce companies<\/li>\n<\/ul>\n<p><strong>VANCOUVER and PLEASANTON, CA, August 29, 2016<\/strong> \u2013 Ritchie Bros. Auctioneers Incorporated, the world\u2019s largest industrial auctioneer and a leading equipment distributor (NYSE &amp; TSX: RBA, \u201cRitchie Bros.\u201d), and IronPlanet\u00ae, a leading online marketplace for used heavy equipment and other durable asset sales, today jointly announced that they have entered into an agreement under which Ritchie Bros. will acquire IronPlanet for approximately US$758.5 million, subject to customary closing adjustments.<\/p>\n<p>Founded in 1999, IronPlanet complements Ritchie Bros.\u2019 primarily end-user customer base, as it focuses largely on the needs of corporate accounts, equipment manufacturers, dealers and government entities in equipment disposition solutions.\u00a0 It conducts its sales primarily through online-only platforms, with weekly online auctions and in other equipment marketplaces.\u00a0 IronPlanet, a private company based in the United States, sold approximately US$787 million of Gross Merchandise Value (GMV)<sup>[1]<\/sup> through their sales channels during 2015, and has achieved a 25.2% compounded growth rate in assets sold from 2013 through 2015.\u00a0 This growth momentum has continued, with a 41% increase in GMV during the first half of 2016 relative to the same period in 2015.<\/p>\n<p>\u201cThis transformative transaction is the logical next step for Ritchie Bros., building on our multi-channel platform, global reach and long-standing customer relationships.\u00a0 Together with IronPlanet, we will create a combined company of trusted brands with the ability to provide customers around the world with a greater number of choices and platforms to sell, buy and list equipment when, where and how they want \u2013 whether onsite or online.\u00a0 Our commitment to diversifying our offerings is directly in line with customer demand for multiple selling and buying solutions,\u201d said Ravi Saligram, Chief Executive Officer of Ritchie Bros. \u201cThis acquisition will help accelerate our growth in revenue and earnings and add shareholder value by continuing to expand our capabilities in new channels, sectors, regions and customer segments.\u00a0 Ritchie Bros. and IronPlanet both have talented teams and winning cultures built on a passion for serving customers.\u201d<\/p>\n<p>\u201cThis is an exciting day for IronPlanet, our customers, employees and shareholders. \u00a0IronPlanet joining forces with Ritchie Bros. will allow the combined company to deliver a multi-channel marketplace that will provide a full range of equipment asset management and disposition solutions. \u00a0IronPlanet has built a leading online marketplace and technology platform across a number of verticals, and when combined with Ritchie Bros.\u2019 strength in live onsite auctions, will prove to be a powerful combination in driving value for our customers,\u201d said Gregory J. Owens, Chairman and Chief Executive Officer of IronPlanet.<\/p>\n<p><strong>Compelling Strategic and Financial Rationale<\/strong><\/p>\n<ul>\n<li><strong>Ideal and complementary fit to expand Ritchie Bros.\u2019 strategy to create a more diversified, multi-channel company with greater scale that can provide even more choice to customers.<\/strong> Equipment sellers frequently choose to sell their assets across multiple sales solutions.\u00a0 The transaction will bring together Ritchie Bros.\u2019 strength in live, onsite and integrated online auctions with IronPlanet\u2019s leading position as an online marketplace, creating a broader multi-format equipment sales and asset management platform, with solutions including:<\/li>\n<li>Ritchie Bros. Auctioneers live onsite and online simulcast auctions<\/li>\n<li>IronPlanet online-only auctions, including a Reserved Daily Marketplace &amp; Buy-Now formats<\/li>\n<li>Cat Auction Services live onsite and online simulcast auctions (auctions anchored by Caterpillar dealers)<\/li>\n<li>Kruse Energy &amp; Equipment Auctioneers<sup>SM<\/sup> live onsite and online simulcast auctions (for the oil &amp; gas industry)<\/li>\n<li>EquipmentOne online auction and marketplace<\/li>\n<li>Mascus sales listing service<\/li>\n<li>TruckPlanet\u00ae, GovPlanet\u00ae, SalvageSale and other sector-specific online sales channels<\/li>\n<li>Ritchie Bros. Private Treaty<\/li>\n<li>Ritchie Bros. Financial Services<\/li>\n<\/ul>\n<p><strong>Creates a more valuable marketplace and expands addressable market. <\/strong>Customers will benefit from a larger marketplace with more buyers and sellers, as well as a greater number of choices and services.\u00a0 As an example of the value the combined company\u2019s multi-channel transactional platforms and greater scale can deliver, Ritchie Bros. also announced today that it has entered into a historic, long-term strategic alliance with Caterpillar, which will significantly strengthen its relationship with Caterpillar dealers.\u00a0 Ritchie Bros. will become Caterpillar\u2019s preferred global partner for live onsite and online auctions under the agreement, which will take effect upon completion of the IronPlanet acquisition.<\/p>\n<p>The addition of IronPlanet provides Ritchie Bros. with access to new, large customer segments, including government surplus and oil &amp; gas.\u00a0 Furthermore, the wider range of sales solutions offered by the combined company will allow it to more effectively meet customer preferences in many key international locations, including the U.K., Germany, Japan and China \u2013 where Ritchie Bros.\u2019 established infrastructure will provide a platform to launch IronPlanet solutions.<\/p>\n<p><strong>Strengthens digital capabilities to provide enhanced levels of customer service. <\/strong>The combined entity will have an integrated technology platform to provide customers with more tailored solutions that meet their needs and enhance the overall customer experience.\u00a0 These solutions, including multiple dealer portal options, valuable business intelligence, amplified data analytics and multiple online sales channels, position the combined company to provide comprehensive asset management solutions.<\/p>\n<p>Together, Ritchie Bros. and IronPlanet are better positioned to cater to evolving consumer preferences, with more transactions being conducted online. \u00a0Collectively, Ritchie Bros. and IronPlanet (on a pro forma basis) sold more than US$3.0 billion of assets through online transactions during the 12 months trailing June 30, 2016 \u2013 ranking the combined business among the world\u2019s top 50 B2B e-commerce companies, based on value sold<sup>[2]<\/sup>.<\/p>\n<p><strong>Expected to deliver long-term growth and profitability. <\/strong>The transaction is expected to be accretive to earnings within the first year (excluding transaction costs) and significantly bolster growth in Gross Auction Proceeds (GAP), revenue and earnings over the long term.\u00a0 The combination will also enhance the generation of free cash flow, which will enable Ritchie Bros. to support strategic growth priorities, return value to shareholders and reduce debt.<\/p>\n<p><strong>Presents tremendous opportunities to build on Ritchie Bros.\u2019 business model and strong heritage. <\/strong>Ritchie Bros. and IronPlanet share a passion for serving customers and providing them with easy-to-use solutions.\u00a0 Bringing together Ritchie Bros.\u2019 scale, geographic footprint and brand strength with IronPlanet\u2019s complementary online models will offer customers more options to move more of their inventory across multiple sales channels.\u00a0 Transparency and a customer focus will continue to be the cornerstones of the combined company, as it leverages best practices from both organizations, including IronPlanet\u2019s successful inspection and IronClad Assurance\u00ae equipment condition certification.<\/p>\n<p><strong>Transaction terms<\/strong><\/p>\n<p>Under the terms of the transaction, Ritchie Bros. will acquire 100% of the equity of IronPlanet for approximately US$740 million in cash and the assumption of unvested equity interests in IronPlanet, subject to adjustment, that brings the total transaction value to approximately US$758.5 million.\u00a0 This represents a 13.0x multiple of IronPlanet\u2019s 2017 Estimated Adjusted EBITDA, inclusive of the expected $100 million net present value of tax synergies and $20 million in run-rate cost synergies.\u00a0 Ritchie Bros. intends to finance the transaction through a combination of cash on hand and new debt, and has bridge financing commitments from Goldman Sachs Bank USA subject to customary terms and conditions to facilitate the transaction close.\u00a0 Following the close of the transaction and the required financing, Ritchie Bros. is expected to have a net debt to EBITDA ratio of no more than 3.0x.<\/p>\n<p>Ritchie Bros. has secured employment agreements with key executives, who will supplement the strength of Ritchie Bros.\u2019 global management team.\u00a0 Mr. Owens has agreed to join the combined company\u2019s executive committee upon closing.<\/p>\n<p>The transaction was approved by the Boards of Directors of both companies and is expected to close by the first half of 2017, subject to regulatory clearances and the satisfaction of other customary closing conditions.<\/p>\n<p><strong>Advisors<\/strong><\/p>\n<p>Goldman, Sachs &amp; Co. is serving as financial advisor to Ritchie Bros. and Skadden, Arps, Slate, Meagher &amp; Flom LLP and Dechert LLP are serving as legal advisors.\u00a0 J.P. Morgan Securities LLC is serving as financial advisor to IronPlanet and Orrick, Herrington &amp; Sutcliffe LLP is serving as legal advisor.<\/p>\n<p><strong>Investor Conference Call and Webcast<\/strong><\/p>\n<p>Ritchie Bros. and IronPlanet will host a joint conference call to discuss the announcement tomorrow, August 30, 2016, at 5:30 am Pacific time \/ 8:30 am Eastern time \/ 1:30 pm BST.\u00a0 A replay will be available shortly after the call.<\/p>\n<p>Conference call and webcast details are available at the following link:<\/p>\n<p><a href=\"https:\/\/investor.ritchiebros.com\/\">https:\/\/investor.ritchiebros.com<\/a><\/p>\n<p><strong>About Ritchie Bros.:<\/strong><\/p>\n<p>Established in 1958, Ritchie Bros. (NYSE and TSX: RBA) is the world\u2019s largest industrial auctioneer, and one of the world\u2019s largest sellers of used equipment for the construction, transportation, agriculture, energy, mining, forestry and other industries. <em>Ritchie Bros.<\/em><sup>TM<\/sup> asset management and disposition solutions include live unreserved public auctions with on-site and online bidding; <em>EquipmentOne<\/em><sup>TM<\/sup>, an online auction marketplace; <em>Mascus, <\/em>a global online equipment listing service; private negotiated sales through <em>Ritchie Bros. Private Treaty<\/em>; and a range of ancillary services, including financing and leasing through Ritchie Bros. Financial Services. Ritchie Bros. has operations in 19 countries, including 45 auction sites worldwide. Learn more at <a href=\"https:\/\/www.rbauction.com\/?utm_campaign=creat-news-web-RB&amp;utm_medium=PR&amp;utm_source=news_sites\">rbauction.com<\/a>, <a href=\"https:\/\/www.equipmentone.com\/?utm_campaign=creat-news-web-E1&amp;utm_medium=PR&amp;utm_source=news_sites\">EquipmentOne.com<\/a>, <a href=\"http:\/\/www.mascus.com\/\">mascus.com<\/a>, <a href=\"https:\/\/www.rbauction.com\/privatetreaty\/?utm_campaign=creat-news-web-RB&amp;utm_medium=PR&amp;utm_source=news_sites\">rbauction.com\/privatetreaty<\/a> and <a href=\"https:\/\/www.rbauction.com\/financing?utm_campaign=creat-news-web-RBFS&amp;utm_medium=PR&amp;utm_source=news_sites\">rbauction.com\/financing<\/a>.<\/p>\n<p><strong>About IronPlanet:<\/strong><\/p>\n<p>IronPlanet is a leading online marketplace for selling and buying used equipment and other durable assets and an innovative participant in the multi-billion dollar used equipment market. Founded in 1999 to transform the global used equipment market, IronPlanet has built a database of more than 1.5 million registered users worldwide. IronPlanet connects buyers and sellers of used equipment with its exclusive IronClad Assurance\u00ae equipment condition certification and family of brands, including IronPlanet\u00ae, GovPlanet\u00ae, TruckPlanet\u00ae, Cat Auction Services, Kruse Energy &amp; Equipment Auctioneers<sup>SM<\/sup>, allEquip\u00ae and Asset Appraisal Services<sup>SM<\/sup>. IronPlanet is backed by Accel Partners, Kleiner Perkins Caufield &amp; Byers, Caterpillar and Volvo. For more information, visit <a href=\"http:\/\/www.ironplanet.com\/\">www.ironplanet.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Increases customer choice; enhances online offerings; provides penetration into large, additional segments Business combination expected to significantly increase growth in revenue and earnings; effectively uses strength of Ritchie Bros.\u2019 balance sheet Transaction expected to be accretive to earnings within first year (excluding acquisition-related costs) Long-term alliance reached with Caterpillar With more than $US3 billion in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":6207,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":""},"categories":[2],"tags":[758,1275],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Ritchie Bros. to acquire IronPlanet to accelerate its customer centric multi-channel diversification strategy - MachineMarket Blog<\/title>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cranemarket.com\/blog\/ritchie-bros-to-acquire-ironplanet-to-accelerate-its-customer-centric-multi-channel-diversification-strategy\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Ritchie Bros. to acquire IronPlanet to accelerate its customer centric multi-channel diversification strategy - MachineMarket Blog\" \/>\n<meta property=\"og:description\" content=\"Increases customer choice; 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