K-Bro Linen Inc., Edmonton, Alberta, Canada, recently announced that it has completed its acquisition of Buanderie Villeray and its affiliate Buanderie La Relance for an enterprise value of $11.5 million and a potential earnout of $1 million, according to a news release.
Villeray is a private laundry and linen operator centrally located in Montréal. The company serves the healthcare and hospitality markets with annual revenues of approximately $10 million. K-Bro will invest $5 million in capital expenditures to expand capacity and enhance operational efficiencies, enabling its Montréal business to significantly grow.
As part of the transaction, K-Bro will close the company’s Granby facility and consolidate its volumes into Villeray. K-Bro anticipates that the integration of its existing Granby operations into Villeray will be completed by the end of the second quarter of 2024. The purchase price and capital expenditures will be satisfied by drawing down on K-Bro’s revolving credit facility.
“Our acquisition of Villeray enhances K-Bro’s position within the attractive Montréal market,” said Linda McCurdy, president and CEO at K-Bro. “Villeray’s modern plant is strategically located in close proximity to customers, and we are investing to expand capacity, consolidate volumes, enhance operating efficiency, reduce fixed costs and support significant growth opportunities.
“The Villeray acquisition is another example of our strategy of acquiring high-quality operators with leading market positions, thus enabling K-Bro to grow market share in key regions. As we emerge from the pandemic, we are excited about our outlook. We continue to have an active M&A pipeline and remain well-positioned from a balance sheet and liquidity perspective to fund acquisitions, organic growth and our normal course issuer bid.”
K-Bro is the largest owner and operator of laundry and linen processing facilities in Canada, the release noted. K-Bro provides a comprehensive range of general linen and operating room linen processing, management and distribution services to healthcare institutions, hotels and other commercial accounts. K-Bro currently operates nine processing facilities and two distribution centers under three brands, including K-Bro Linen Systems Inc., Buanderie HMR and Les Buanderies Dextraze, in 10 Canadian cities: Québec City, Montréal, Toronto, Regina, Saskatoon, Prince Albert, Edmonton, Calgary, Vancouver and Victoria. Fishers, acquired by K-Bro in 2017, was established in 1900 and is an operator of laundry and linen processing facilities in Scotland. The company operates five sites with facilities in Cupar, Perth, Newcastle, Livingston, Inverness and Coatbridge.
For further information, visit www.k-brolinen.com.
Publish Date
November 3, 2023
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