US-based Toro Company is set to acquire The Charles Machine Works - owner of Ditch Witch - for $700 million (€620 million).
Charles Machine Works manufacturers underground utility construction equipment, including horizontal directional drills, walk and ride trenchers, utility loaders and vacuum excavators. In 2018, the family-owned company generated revenues of approximately $725 million (€640 million).
In addition to Ditch Witch, the acquisition includes brands including Subsite Electronics, DW/TXS, HammerHead, Radius HDD, American Augers, Trencor and MTI Equipment.
The deal is subject to regulatory approvals, but it is expected to close before the end of the third quarter of Toro’s 2019 fiscal year, which will be July 2019.
Richard Olson, Chairman and CEO of Toro, said, “The addition of Charles Machine Works will further strengthen our portfolio of market-leading brands supported by talented employees, a commitment to innovation, a best-in-class dealer network and long-standing customer relationships.”
He said Charles Machine Works aligns well with Toro’s strategic priorities and expands the company’s operations into a market that is attractive given the potential for growth in updating ageing infrastructure and installing new infrastructure required for next-generation technologies such as 5G mobile communications.
Olson added, “Culturally, our two organisations are very well aligned and, in our past experience, that has been essential to the success of a business combination like this.”
Rick Johnson, CEO of Charles Machine Works, said; ”Our success is the result of years of hard work and an unwavering commitment to developing innovative solutions for customers.
“From developing the world’s first service line trencher in Perry, Oklahoma, to today’s robust Ditch Witch dealer network, our family of companies is well-positioned to join The Toro Company’s family of brands. We look forward to building upon our founder’s legacy of best-in-class offerings in the expanding underground construction market.”