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October 2017

Thermon Announces Strategic Acquisition of CCI Thermal Technologies Inc. for CAD $258 Million


Thermon Group Holdings, Inc. announced the execution of a definitive agreement to acquire 100 percent of the equity interests of CCI Thermal Technologies Inc. and certain related real estate assets in an all-cash transaction valued at CAD $258 million.

 

CCI is a leader in the development and production of engineered heating and filtration solutions for industrial and hazardous area applications. CCI markets its products through several diverse brands known for high quality, safety and reliability, and serves clients in the energy, petrochemical, electrical distribution, power, transit and industrial end markets globally.

 

The acquisition of CCI supports Thermon’s vision to be the world’s leader in industrial process heating solutions by diversifying its product portfolio and end market exposure.

 

The acquisition will also strengthen Thermon’s financial profile and provide a platform for future growth and consolidation in an adjacent, fragmented $800 million market. The current management team, led by President Bernie Moore, will continue to operate CCI from its Edmonton, Alberta headquarters, building upon its track record of profitability and growth.

 

Bruce Thames, President and Chief Executive Officer of Thermon said: “Thermon’s growth strategy is based, in part, on highly-complementary acquisitions that contribute proven technologies, products, enhanced scale and access to attractive new end-markets.

 

“These durable attributes make CCI an ideal strategic and financial fit and will greatly enhance the value Thermon is able to bring to its customer base. CCI is a well-run company that significantly expands our addressable market. Together with CCI’s management team, we will continue to prudently build the company for sustained growth and profitability.

 

“Strong cash flows generated by the combined company will create the financial strength to comfortably operate the business and enable de-levering of the balance sheet going forward. We believe this transaction will differentiate Thermon in the marketplace and deliver clear, long-term financial benefits for our shareholders.”

 

Harold Roozen, Executive Chairman of CCI added, “We believe that Thermon is the perfect partner to help us build on our strong brands and long-standing customer relationships. The opportunity to leverage Thermon’s global footprint to expand CCI’s business into new geographies is exciting. The combination of the two companies will truly create a world leader in process heating solutions.”

 

Ciscan Industries was founded in 1964 in Edmonton, Alberta and formed CCI Thermal Technologies Inc. following the acquisition of DriQuik in 2000. CCI’s current management team has been involved with the business since 1992.

 

CCI has approximately 375 employees that support manufacturing and fabrication at five facilities in Canada and the United States.

 

For its fiscal year ended July 31, 2017, CCI generated approximately CAD $95 million in total revenue, net income of CAD $15.9 million and Adjusted EBITDA of CAD $22.5 million, after adjusting for certain payments to related parties and other expenses that are not anticipated to continue after closing.

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