EnviroStar (NYSE: EVI) is a distributor of commercial laundry and dry cleaning supplies and equipment. On June the 2nd, the company announced their plans to acquire the Denver, Colorado based distributor, Martin-Ray Laundry Systems. The company confirmed they had executed a definitive asset purchase agreement and will acquire all assets from Martin-Ray. The final price is expected to be 4 million dollars. Half will be paid in cash, while the remaining amount will be paid in EVI common stock.
Martin-Ray offers laundry installation and maintenance services to commercial clients. They also distribute laundry products. For the twelve months ending on March 31, 2017, the company generated approximately 11.5 million dollars in revenue. The company distributes a handful of key brands, including Chicago Dryer, Speed Queen, and Pellerin-Milnor, across some of America’s fastest growing markets.
EVI hopes to use the acquisition to give them footing in the Mountain states, while also allowing for the acceleration of future growth in the region. Martin-Ray has over 1,500 customers in various markets, including healthcare, commercial, vended laundry, and hospitality. After the acquisition has been finalized, Martin-Ray will become a wholly owned subsidiary of EVI and will continue to operate under its current name. Current locations and employees are not expected to change.
The transaction, which is expected to be accretive to EnviroStar’s earnings, is subject to customary closing conditions. Both parties intend to close the transition within the next 30 days. More details can be found here.