Posted August 12, 2019

Jason Industries explores sale of company

Jason Industries announced the sale of its Janesville Fiber Solutions segment and also indicated that it is exploring a potential sale of the entire company.

Jason has signed a definitive agreement to sell its Janesville segment to Motus Integrated Technologies for approximately $85 million, subject to customary closing, performance, and other requirements. The transaction is expected to be completed during the third quarter.

Janesville Fiber Solutions is a producer of acoustical and thermal fiber insulation for a variety of automotive applications.

“The divestiture of Janesville reduces Jason’s automotive market exposure, simplifies our portfolio to the remaining Industrial and Engineered Components businesses, and increases liquidity. Janesville can achieve its true potential under new ownership,” said Brian Kobylinski, chairman and chief executive officer of Jason. “Our employees have done an outstanding job improving operational and commercial performance and we thank them for their hard work and dedication to the business.”

The Janesville segment contributed approximately $144 million to Jason’s trailing 12-month sales ending June 28, 2019. Janesville’s operations in the United States and Mexico and approximately 1,000 employees will become a new subsidiary of Motus, an automotive interior component manufacturer.

Jason has engaged BMO Capital Markets Corp. to explore strategic alternatives, including a potential sale of the company.

“The remaining core Industrial and Engineered Components are high quality and well managed businesses, presenting opportunity to build upon strong operational foundations with organic growth and tuck-in acquisitions,” said Mitch Quain, lead independent director.

In the recently completed second quarter, net sales of $138.3 million decreased 17.9 percent, and included a negative 4.8 percent impact from the planned exit of non-core businesses, a positive 3.2 percent impact from the acquisition of a business and a negative 1.3 percent from foreign currency translation. Organic sales declined 15.0 percent primarily due to platform changes in Fiber Solutions and overall weaker demand across end markets in Engineered Components and Industrial.

A net loss of $13.1 million, or 49 cents diluted loss per share, compared to a net loss of $355,000, or 4 cents, in the same quarter last year.