CLERMONT-FERRAND, France — Group Michelin has struck a deal to buy Camso Group, the Magog, Quebec-based off-road tire and rubber track producer, and plans to combine the business with its own OTR tire activities into a new division to be based in Quebec.
Michelin has agreed to pay $1.45 billion for Camso, which the French company said represents an enterprise value of $1.7 billion, or a multiple of 8.3 times EBITDA after synergies. The transaction will not impact Michelin's financial position.
Michelin said the deal — subject to "customary approvals" — will create a leader in OTR mobility solutions, with 26 plants, roughly 12,000 employees and annual sales exceeding $2 billion.
Through studies and discussions with Camso, Michelin has identified significant opportunities to increase sales and reduce costs, thereby unlocking up to $55 million in synergies by 2021.
"Michelin and Camso have many values in common," Michelin CEO Jean-Dominique Senard said. "This acquisition is a wonderful mutual opportunity. Michelin will benefit from all of Camso's skills in the off-the-road mobility markets and Camso from the full range of Michelin's expertise in the specialty markets."