Ritchie Bros., the world's largest heavy-equipment auctioneer and provider of end-to-end services, has completed its acquisition of IronPlanet, a leading online marketplace for heavy equipment and other durable assets.
Ritchie Bros. acquired IronPlanet for approximately $758.5 million, subject to customary closing adjustments. The acquisition was financed through a combination of Ritchie Bros.' previously announced senior note offering and secured term loan facility. The transaction is expected to be earnings accretive within the first year, excluding acquisition-related costs.
The acquisition of IronPlanet accelerates Ritchie Bros.' strategy of becoming a one-stop, multi-channel company where customers can buy, sell, or list equipment, when, how, and where they choose–both on site and on line. Later this year, Ritchie Bros. will combine its online EquipmentOne brand with the IronPlanet DailyMarketplace, creating a harmonized brand offering called Marketplace E that gives customers more ways to set reserve pricing. Ritchie Bros. also gains expanded growth capabilities in the oil and gas and government sectors.
The company will be combining the Ritchie Bros. and IronPlanet sales forces in the U.S., Canada and Europe, in line with its strategy to provide customers a one-stop, multi-channel experience.
Territory and strategic account managers will be positioned as solution sellers and will offer customers three main products: RBA integrated unreserved on-site auctions; IronPlanet weekly featured auctions; and Marketplace E, an IronPlanet solution.
Mascus, Kruse Energy and GovPlanet will continue to remain as stand-alone businesses with stand-alone sales teams, given that they serve specialized customer segments.
As a part of this acquisition, Ritchie Bros. also enters into an initial five-year strategic alliance with Caterpillar that is expected to strengthen its relationship with Caterpillar's independent dealers around the world by providing them enhanced and continued access to a global auction marketplace to sell their used equipment. The company also will continue to coordinate and manage Cat auctions in respective Cat dealer geographies.
"We are pleased that the acquisition of IronPlanet has been completed and I am delighted to welcome IronPlanet employees to the Ritchie Bros. family. Our shared passion for serving customers is loud and clear and it will continue to be our guiding light in the unified company," said Ravi Saligram, Ritchie Bros. CEO. "Our integration plans have been meticulously worked on during the last nine months: our combined senior management team will be in place Day 1 and our sales forces will be integrated within the first 30 days. In the second half of 2017, we will focus on aligning and unifying the company, optimizing the integration, starting to achieve synergies and getting the organization ready for a fast start in 2018 to deliver growth and add shareholder value."
Saligram has designed his new organizational structure to maximize growth outcomes by utilizing the complementary skillsets of senior leaders from both companies. All leaders mentioned below report to Saligram unless otherwise mentioned.
Operational Leaders:
Greg Owens, former CEO of IronPlanet, is named Group President, New Sectors & Ventures. He will oversee all aspects of the Cat Strategic Alliance, GovPlanet, and Kruse Energy. He will also explore ventures to enter new sectors and businesses, both organically and through acquisitions.
Jim Barr, Group President, Multichannel Products & Technologies, will lead all aspects of digital product development, online operations, digital marketing, and provide strategic oversight to the technology group.
Jeff Jeter, former President of IronPlanet, is named President, Sales U.S. He will lead the combined field and strategic accounts sales force.
Brian Glenn is named SVP & Head of Sales, Canada. He will lead both western and eastern Canadian field sales teams.
Karl Werner will continue in his role as President, International, and Jeroen Rijk will continue in his role as SVP & MD, Europe, with expanded responsibility for IronPlanet offerings.
Functional Leaders:
Sharon Driscoll, CFO, Todd Wohler, CHRO, Darren Watt, SVP & General Counsel, and Doug Olive, SVP, Pricing & Valuations, will continue in their roles with added responsibilities for the combined company.
Becky Alseth will assume the role of SVP, Brands & Innovation, and focus on the evolution of all RB brands, value propositions, generating insights and leading marketing services, field marketing and seller marketing. She will also jump start a comprehensive innovation program throughout the company, initially focused on live auctions.
Doug Feick will assume the role of SVP, Corporate Development and Integration Optimization. Doug will lead M&A initiatives and in the near term will lead ongoing integration.
Kieran Holm, SVP, Operations Excellence & Efficiencies, will focus on the acceleration of structural cost savings and efficiencies, as well as proactively optimizing the company's site network. He will also assume added responsibility as the synergies champion for the IP acquisition.
Frank Roth will assume the role of SVP, Sales Effectiveness. He will focus on enabling the sales force to drive solution selling, create operational rigor on the use of sales analytics and sales management tools, and develop programs to drive growth and increase sales productivity.
Marianne Marck, Chief Information Technology Officer, reporting to Jim Barr, will assume responsibility for leading and overseeing the Technology and Engineering teams across all of Ritchie Bros., including RBA, IronPlanet, Mascus, Xcira, and RBFS. She will drive overall data and technology strategy to make IT a significant competitive advantage for the company.
Jeff Barca-Hall will partner with Marianne as SVP & Chief Technology Officer and will lead efforts to build future state, cutting-edge Marketplace technologies and the consolidation of current platforms and offerings.
Matt Ackley, SVP, Product Management and Digital Marketing, reporting to Jim Barr, will be responsible for on-line demand generation, buyer product marketing, product management, inside sales and on-line auction management.
Randy Berry, SVP, Digital Operations, reporting to Jim Barr, will continue to lead IP Inspections, Operations and Asset Appraisal Services and assume responsibility for RBA online operations and the Customer Service Group.
Ritchie Bros. will maintain its global headquarters and technology presence in Vancouver, British Columbia, and has confirmed that Pleasanton, Calif., IronPlanet's headquarters, will also be one of its key technology hubs. The company will optimize its U.S. office network over the next few years and establish a small commercial hub in the western suburbs of Chicago in the fall of 2017.
Ritchie Bros. and IronPlanet first announced the acquisition in August 2016, and announced unconditional antitrust clearance from the U.S. Department of Justice on May 18, 2017.
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