Brinks on Thursday announced that it has agreed to purchase rival Dunbar Armored, Inc., the fourth largest U.S. cash management company, for approximately $520 million in cash. According to a statement issued by the company, the acquisition will be funded from Brink’s available cash and is expected to close by the end of 2018, subject to customary closing conditions and regulatory approval.
Based in Hunt Valley, Maryland, Dunbar employs approximately 5,400 people, operates 78 branches throughout the U.S. and has more than 1,600 armored trucks in its fleet. Over the last 12 months, the company has generated approximately $39 million in revenue.
For its part, Brinks said the acquisition will expand and differentiate their customer base with Dunbar’s complementary focus on small-to-medium sized retailers and financial institutions.
“Dunbar and its employees have built an excellent reputation and a loyal customer base over the last 95 years under generations of family leadership. The combination of our two companies, each with an impressive heritage, forms a solid foundation for future success,” Doug Pertz, Brink’s President and CEO, said. “We plan to integrate Dunbar’s strong management, experienced personnel and efficient use of assets to accelerate operational excellence and continued margin growth in our U.S. operations.”
Kevin Dunbar, CEO of Dunbar Armored, said: “My father started this business and grew it through his hard work and ability to attract and retain great employees and loyal customers. He entrusted me to continue to grow the business to levels that we never thought could be reached, and the level of care with which we have built the Dunbar brand and business is one of our greatest sources of pride. We are delighted with the Brink’s transaction and are confident that Brink’s will continue the Dunbar successes. At the end of the day, our business is all about our great employees and loyal customers, and we are ready to entrust Brink’s with both.”
Brinks said it expects the combined entity to achieve substantial cost and operational synergies driven by improved route density, branch optimization and administrative efficiencies. In addition, Brinks expects to invest approximately $50 million in capital expenditures over three years to support branch rationalization and the integration of Dunbar’s fleet. The combination of Dunbar and Brink’s U.S. operations is expected to yield annual cost synergies of $40 million to $45 million. Full integration and synergies are expected to be achieved over three years, with the majority achieved by the end of the second year.
Pertz added: “This transaction is the most significant demonstration to date of our strategy to accelerate profitable growth by making core acquisitions in our existing geographic markets. Upon closing the Dunbar acquisition and the previously announced acquisition of Rodoban in Brazil, the ‘excess’ cash on our balance sheet will be fully deployed to generate strong returns, and we’ll still have most of our $1 billion revolver available for additional investments. In addition, we will have invested more than 85 percent of the $800 million we targeted for accretive core acquisitions during 2018 and 2019.”
