United to acquire BlueLine Rental for $2.1 billion
By Lindsey Anderson10 September 2018
Following its recent purchases of Neff Corp., NES Rentals and BakerCorp, the world’s largest equipment rental company will tack on another big buy – BlueLine Rental. For $2.1 billion, United Rentals will acquire BlueLine Rental from investment firm Platinum Equity. The deal is set to close in the fourth quarter of 2018.
BlueLine Rental was originally founded as Volvo Rents in 2001. Volvo Rents was then sold to Platinum Equity in 2014 and the company changed its name to BlueLine Rental. BlueLine operates through a network of 114 locations, mostly in the U.S., with 1,700 employees. The company has more than 46,000 units in its aerial fleet and ranked 12th on Access International’s Access50 toplist with 18,012 pieces of access equipment. Overall, it is one of the 10th largest equipment rental companies in North America and it generated $313 million of adjusted EBITDA at a 39.8 percent margin on $786 million of total revenue for the 12 months ending on August 31, 2018.
United said the purchase will increase its footprint to many large metropolitan areas in North America including the U.S. coasts and Gulf areas.
Michael Kneeland, chief executive officer of United Rentals, said, “The acquisition of BlueLine meets all of our criteria for long-term, profitable growth at attractive returns. We’re executing our strategy of ‘growing the core’ in a strong demand environment to drive superior value for our customers and shareholders. Our company will be going to market with more talent, capacity and customer diversification than ever before.”
Kneeland continued, “There are some distinct advantages to the BlueLine integration, such as our common technology systems and strong safety cultures. BlueLine has a fleet mix that complements our own, and a well-diversified base of mid-sized and local customers, many of whom can use our specialty solutions. We expect to complete the acquisition in the fourth quarter, setting the stage for an exciting 2019. I look forward to welcoming our new colleagues very soon.”
United Rentals plans to pause its current $1.25 billion share repurchase program upon closing the BlueLine acquisition to integrate the operations and assess other potential uses of capital, the company said. This is consistent with the company’s approach during the integrations of NES Rentals and Neff Rental in 2017.
United Rentals, Inc. is the largest equipment rental company in the world with more than 1,054 rental locations in North America and 11 in Europe. The company employs approximately 16,400 people. United said the combination of the companies is expected to generate approximately $45 million of cost synergies in the areas of corporate overhead, operations and third-party re-rent, and improve returns on BlueLine used equipment sales. Additionally, United Rentals expects to realize approximately $15 million of fleet and other procurement savings based on the combined spending.
There was no word on staffing or personnel changes.