Simpson Manufacturing Offers to Buy Europe's Etanco Group for $818M

Entaco is a designer, manufacturer and distributor of fixing and fastening solutions for the building construction market throughout Europe.

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PLEASANTON, CA — Simpson Manufacturing Co., an industry leader in engineered structural connectors and building solutions, announced Dec. 29 that it has submitted a binding offer with exclusivity to acquire the Etanco Group for €725 million (approximately $818 million). Etanco is a designer, manufacturer and distributor of fixing and fastening solutions for the building construction market throughout Europe, which includes innovative fasteners, connectors, anchors and safety solutions for roofing, cladding, façade, waterproofing and solar applications. For the twelve months ended September 30, 2021, Etanco's net sales and operating income margin were approximately €258 million (approximately $291 million) and 19.7%, respectively. The acquisition is expected to close near the end of the first quarter of 2022 and is anticipated to be accretive to the company's earnings within the first full fiscal year after closing.

Etanco Owler 20181126 162341 Original"Etanco's business of providing reputable, highly-engineered technical solutions with a high focus on customer service, align with Simpson's core business model and values, making Etanco an ideal acquisition to support continued growth in our European business," said Karen Colonias, President and Chief Executive Officer of Simpson Manufacturing Co., Inc. "The acquisition of Etanco fortifies our footprint and expands our geographical reach in Europe, deepens Simpson's portfolio of solutions with new and existing customers, and allows us to enter into new commercial building markets and grow our direct sales activity across the region. Further, we expect the acquisition to drive significant net sales growth with operating income synergies of approximately $30 million on an annual run-rate basis."

Colonias continued, "Etanco fits within Simpson's acquisition strategy of strengthening our business by expanding our product lines, developing complete solutions, growing our market share and improving both our manufacturing capabilities and efficiencies. In addition, our ability to leverage Etanco's commercial building business further balances Simpson's product portfolio and directly aligns with our key growth initiatives focused on expanding into commercial building offerings and building a leadership position in fastener solutions. We believe the acquisition of Etanco will materially contribute to both net sales and operating income margin growth in Europe, and in turn, create value for all key Simpson stakeholders."

"We are very pleased to join the Simpson team and look forward to participating in their growth plans for the future," said Ronan Lebraut, Chief Executive Officer of Etanco Group. "Etanco and Simpson share the same core values of providing high-quality products and customer service, and we view this partnership as a great opportunity to broaden our product lines and further our customer and market reach."

Simpson Manufacturing LogoStrategic Rationale

Etanco's primary product applications directly align with the addressable markets in which Simpson operates, estimated at over $5.0 billion. Leveraging Etanco's leading market position in Europe, following the proposed acquisition, Simpson would expand its portfolio of solutions, including mechanical anchors, fasteners and commercial building envelope solutions, as well as significantly increase its market presence across Europe. The transaction would allow the Company to enter into new commercial building markets such as façades, waterproofing, safety and solar, as well as grow its share of direct business sales. 

Financial Impact

The acquisition of Etanco is expected to be accretive to the Company's earnings within the first full fiscal year after closing. Etanco's purchase price represents an approximate 11.9 times multiple of trailing twelve months unaudited EBITDA. The Company would expect to scale its European net sales and operating income margin performance, resulting in an approximate 500 basis point increase in Europe operating income margins by 2025.

Synergies and Integration

Simpson expects to realize operating income synergies of approximately $30 million, on an annual run rate basis, within 36 months following the proposed acquisition. These synergies would be achieved through expanding Simpson's market share by selling its products into new markets and channels, incorporating Etanco's products into existing Simpson channels, as well as procurement optimization, manufacturing and operating expense efficiencies. The Company expects to hire a third party consultant to assist with post-close integration.


The acquisition is expected to be funded via a combination of $100 million of existing cash with the remainder from borrowings under the Company's existing Revolving Credit Facility, which will be increased from $300 million to $450 million, and a $450 million unsecured term loan with committed financing from Wells Fargo Bank and MUFG Union Bank. The Company expects its net debt-to-EBITDA ratio to be below 1.5x by the end of the second year following the closing of the acquisition, maintaining the Company's conservative leverage profile.  

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