By CoinWeek News Staff ….
On Tuesday, December 5, Crane Company, based out of Stamford, Connecticut, issued a press release announcing the purchase of the similarly named Crane & Co. (otherwise known as “Crane Currency“) for a net price of $800 million USD. The buyout was then expounded upon by the company at a teleconference meeting for investors on December 6.
According to Max Mitchell, President and CEO of Crane Company, his company is acquiring a 100% equity stake in Crane Currency by purchasing shares from the private equity firm Lindsay Goldberg, members of the Crane family, and other shareholders in a cash-only transaction (incidentally, former Treasury Secretary Jacob “Jack” Lew is joining Lindsay Goldberg as a full partner). Crane Co. will also take on any debt Crane Currency had on its books (thus resulting in the $800 million net). The price is approximately 8.5 times larger than Crane Currency’s estimated earnings for 2017 before taxes.
Both concerns will close the deal in the first quarter of 2018. It is the second-largest acquisition in Crane Company history, making the corporation the second-largest global company in the payments technology arena with almost $4.5 billion in revenue.
Mitchell says that the acquisition fits in with his company’s strategic plan for growth in the field of payment technologies. Crane Co. is a manufacturer of currency validating devices used in vending machines and other sorts of automated apparatus that handle physical money and has collaborated with Crane Currency in the past. Crane Company employs about 11,000 people in 26 countries and also has production capabilities in the aerospace, electronics, and telecommunications fields, among others.
Crane Currency CEO Stephen P. DeFalco says that there will be no changes in the short term for his company’s Dalton, Massachusetts factory, where approximately 600 employees work. Management will also stay the same, says DeFalco, although he himself will be stepping down. Current Crane Currency President of International Currency, Annemarie C. Watson, will succeed him.
About the Companies Involved
Crane Currency, based in Berkshire, Massachusetts, is one of the world’s largest currency substrate and banknote anti-counterfeiting technology suppliers. It manufactures and delivers cotton-based paper products to over 50 central banks globally and employs about 1,100 people around the world. The company was founded in 1801 by Henry Wiswall, John Willard and Zenas Crane, though the mill itself had been in the Crane family for over 30 years and had supplied paper for the first Colonial American paper money printed by Paul Revere.
Crane first began to develop anti-counterfeiting technology for its paper money products when it embedded silk threads in banknotes in 1844. It began to service the federal government in 1879 and became the only supplier of currency substrate to the United States in 1964. In 2004, Crane expanded its facilities to include international operations when it purchased its Tumba plant from the Sveriges Riksbank in Sweden. In 2005, Crane introduced the first micro-optic security feature on the new $100 Federal Reserve Note, a type of security feature that was quickly adopted by much of the rest of the world.
With banknote production still growing, both at home and abroad, Crane Currency’s before-tax earnings for 2017 are estimated at about $94 million USD.
Crane Company was founded in Stamford, Connecticut by one Richard Crane (no relation to Zenas) in 1855. Beginning with a foundry in Chicago, Crane has expanded into a multitude of engineering and production areas, including payment technologies.
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Sources
https://seekingalpha.com/article/4130213-cranes-cr-crane-currency-acquisition-announcement-transcript (registration required)
http://www.nasdaq.com/article/crane-co-to-buy-crane-currency-reaffirms-17-earnings-view-cm887440
http://www.masslive.com/news/index.ssf/2017/12/crane_currency_to_sell_for_800.html
http://wamc.org/post/crane-currency-be-sold-800m-manufacturing-will-remain-dalton
