Crestview sealed a $1.4 billion deal with Hitachi to sell its 4-years-old subsidiary, JR Automation

As
per the sources, selling JR Automation wasn’t the primary plan for Crestview
Partners. Prior to it, the private equity firm had explored the option of
taking the JR Automation public. Previously, the firm had also negotiated with
bankers to put its plans of JR Automation’s initial public offering (IPO) in
action. The sources also added that the inbound interested that the company
received on JR was substantial. Crestview has owned JR Automation for around
four years.

Crestview
Had Considered JR Automation’s IPO Before Closing The Deal With Hitachi

According
to the experts, Dual track processes have been getting commoner than ever
before. It is a process that sees a seller simultaneously pursuing an IPO as
well as a sale. Owing to the massive interest, however, Crestview decided in
favor of opting for a sale first; a strategy that impeccably worked for Crestview
as Hitachi announced on Friday that it’ll be signing a deal valued at $1.425
billion to purchase the Michigan based company.

As
per the specifics of Crestview’s deal with Hitachi, the private equity firm has
made as much as 7.5 times the money that it had originally invested in JR
Automation.

Since
1980, JR Automation has served its valuable customers in construction, consumer
products, and automotive industries with its automated manufacturing systems.
The company is known to help its clients that are stuck with manufacturing
problems. JR Automation currently employees 2000 professionals while it also
makes extensive use of robotics to provide solutions.

In
a statement, Hitachi’s executive vice president, Masakazu Aoki, was reported quoting:

“With
JR Automation’s robotic system integration capabilities, combined with Hitachi’s
digital solutions and technologies, we can provide customers with new,
unparalleled value by connecting the whole process.”

Crestview
Tripled JR Automation’s Sales In Four Years

Crestview
had made an investment into JR Automation around four years ago in March 2015.
According to PitchBook, following the purchase, JR Automation has seen its
sales skyrocket from $170 million to more than $600 million that marks three
times its sales prior to Crestview’s buyout.

Currently,
the company has 23 plants in various locations in Asia, Europe, and North
America. Before 2015, the total number of plants JR Automation had was five.  

Crestview’s
primary focus has always been on financial services and industrial sector. The
firm had used its 3^rd fund to make the sizeable investment in JR
Automation. In 2015, the fund had closed on $3.2 billion.  

Marketing
for the private
equity firm’s fourth flagship has already started. For its 4^th
fund, the company has already collected around $1.88 billion. As per January
2018’s report, the buyout shop has the potential to raise $3.5 billion in funds
for the pool.

JR
Automation spokesperson is yet to comment on the news.