Barnes Group, an industrial manufacturing specialist, has agreed to a $3.6 billion take-private deal with Apollo Global Management, marking the firm’s latest investment in the industrials space.
Apollo said it sees Barnes as positioned to take advantage of “long-term aerospace demand trends,” as well as needs for engineered components across other markets.
Founded in 1857, Barnes Group manufactures engineered products for aerospace and other sectors, generating $1.45 billion in annual revenue.
PitchBook senior industrials analyst Jim Corridore said PE deals in the industrials sector are trending above last year, with transaction sizes rising relative to other parts of the asset class.
Apollo is active in industrials; it completed an $8.1 billion take-private in 2023 of Univar Solutions, a specialty chemical and ingredient distributor.
The Barnes deal comes after Apollo outlined plans during its Oct. 1 Investor Day to grow its PE business, among others, and increase total AUM to $1.5 trillion within five years.
Apollo emphasized that while many PE managers focus on market/revenue growth and multiple expansion, its team prioritizes operational improvements.
The Connecticut-based industrial manufacturer was targeted in 2022 by activist investor Irenic Capital, which sought changes to the board of directors. In March, Barnes announced board changes including the addition of Irenic co-founder Adam Katz.
In the all-cash transaction with Apollo, Barnes’ shareholders are set to receive $47.50 per share, a 22% premium over the closing price on June 25. The deal is expected to help Barnes expand its product offerings and enhance its financial performance.
Barnes enlisted Goldman Sachs and Jefferies as financial advisors, with Wachtell, Lipton, Rosen & Katz serving as legal counsel. Apollo’s legal counsel included Latham & Watkins and Paul, Weiss, Rifkind, Wharton & Garrison.
Correction: An earlier version of this article incorrectly stated the founding year of Barnes Group. The correct year is 1857. (Oct. 8, 2024)
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