Display Mounts Firm Ergotron Changes Owners In $650M Cash Deal
July 11, 2022 by Dave Haynes
One of the more well-established names in AV mounting hardware – 40-year-old Ergotron – has been acquired by a Houston-based private equity firm.
Based in St. Paul, MN, Ergotron mounts are mainly used for desktop monitors and things like moveable AV carts in environments like healthcare, education and manufacturing. They are particularly strong in things like mounts with articulating arms that allow screens to be positioned and oriented as needed. But the company has also been a go-to, particularly back in the nascent years of the business, for digital signage applications. The first retail network I put in, when I was doing that sort of thing 20+ years ago, used Ergotron countertop mounts.
“Ergotron is a pioneer in ergonomic solutions, and its strong market position and commitment to its customers and employees seamlessly align with Sterling’s employee-focused approach to partnerships,” says Brad Staller, Partner at The Sterling Group. “We look forward to supporting the management team as they look to accelerate growth.”
“Our partnership with Sterling Group will enable Ergotron to continue building on its 40-year legacy of designing solutions that support the wellness of caregivers and workers and how they interact with technology,” adds Chad Severson, CEO of Ergotron.
The deal also comes with more than 200 patents.
Ergotron was sold by a UK company that operates with the expressed mantra of Buy Improve Sell.
Says the PR from the London firm:
Melrose Industries PLC (“Melrose”, the “Company” or the “Group”) has entered into an agreement to sell its Ergotron business (“Ergotron”), to funds managed by The Sterling Group (“Sterling”) for total consideration of approximately $650 million (c.£520 million), payable in cash on completion (the “Disposal”). Ergotron is a leading designer, manufacturer and distributor of ergonomic products for use in a variety of working, learning and healthcare environments, with gross assets (mostly goodwill) as at 31 December 2021 of £617 million and 2021 adjusted operating profit of £58 million (2021 EBITDA £62 million).
Completion of the Disposal is expected to occur in the third quarter of 2022 (“Completion”) and is conditional upon customary US antitrust approvals. On or before Completion, Melrose will announce how it intends to use the net proceeds from the Disposal.
Having sold the Nortek Air Management and Nortek Control businesses last year, Ergotron is the last of the businesses remaining from the Nortek Inc acquisition in 2016. On Completion, Melrose will have more than doubled shareholders’ initial investment, whilst transforming the Nortek businesses themselves.
Refocusing them away from unprofitable work, Melrose made the significant investment necessary to implement operational best practices, increase R&D, develop new products and build stronger customer relationships. These actions resulted in an almost doubling of adjusted operating margins and ensured each business remained highly cash generative, with over $1 billion generated during Melrose ownership.
This strong support and appropriate investment under Melrose ownership unlocked the potential of all the Nortek businesses and set them on the path for further success under new owners for the next stage of their development.
Simon Peckham, Chief Executive of Melrose: “The sale of Ergotron is the final step in our Nortek ownership cycle, capping what has been a very successful acquisition for Melrose shareholders. We will have more than doubled shareholders’ equity investment in Nortek and have transformed the businesses themselves. Our attention now remains firmly on achieving the same result for the current Group.”
Leave a comment