Stabilus to acquire DESTACO from Dover to bolster industrial automation footprint
In a pivotal decision amplifying its position in the motion control solutions arena, Stabilus SE, a global leader in the field, is set to acquire DESTACO, a prominent supplier of industrial automation components. Dover Corporation, a diversified industrial manufacturer rooted in the USA, will transfer ownership of DESTACO to Stabilus in a cash transaction valued at US$680 million. This acquisition is earmarked for completion in H1 2024, contingent upon regulatory clearances and the culmination of certain regional transactions.
Stabilus’ ambitious STAR 2030 strategy focuses on amplifying its Industrial sector’s presence. The current acquisition plays a crucial role in reaching a projected revenue equilibrium between its Automotive and Industrial divisions. Upon successful integration, the Industrial segment’s revenue within the Stabilus Group is projected to hover around 46% based on 2023’s fiscal expectations.
Boasting a revenue of US$213 million in 2022, DESTACO, established in 1915 and headquartered in Auburn Hills, Michigan, stands out as an industry titan in automation, workholding, and remote handling solutions. Its diverse portfolio, encompassing clamping systems, robotic tooling, and more, seamlessly dovetails with Stabilus’ industrial offerings. Serving industries from automotive to life sciences, DESTACO’s products epitomize innovation. Having been a part of the Dover Corporation family since 1962, the company now operates across key global locations like the USA, Europe, and Asia, employing around 650 professionals.
Stabilus to acquire DESTACO from Dover in $680m deal to bolster industrial automation footprint. Photo courtesy of Andreas Gall/Wikimedia Commons.
Michael Büchsner, Stabilus’ CEO, highlighted DESTACO’s centennial legacy and pivotal role in the burgeoningly significant industrial automation landscape. With production reshoring gaining momentum and the demand for enhanced automation systems due to a skilled workforce deficit, DESTACO’s capabilities emerge as paramount. “We anticipate ushering in a new era of advanced motion control solutions with DESTACO under the Stabilus umbrella,” remarked Büchsner.
Financially, this move promises to be a boon for Stabilus. Immediate upticks in revenue and positive impacts on adjusted EBIT margins are anticipated post-transaction. By fiscal 2026, sales synergies exceeding €50 million annually are expected, spurred by a unified market presence and product alignment. Further, cost synergies amounting to over €10 million per annum and significant tax benefits are on the horizon.
The transaction’s financing amalgamates Stabilus’ €150 million cash reserve, a €250 million credit line, and a €250 million bridge facility. Stefan Bauerreis, CFO of Stabilus, emphasized the acquisition’s alignment with their dual-sector strategy, underscoring the prospective financial merits and sustained growth trajectory.
Dover Corporation, on the other hand, views this transition as a strategic move, redirecting its focus towards its core platforms. Richard J. Tobin, Dover’s CEO, is confident about Stabilus accentuating DESTACO’s impact in the industrial automation space.
Historically, Stabilus has shown a penchant for strategic acquisitions, absorbing various companies over the years and solidifying its industry footprint. The current acquisition is another testament to Stabilus’ vision of becoming a global behemoth in motion control solutions.