Kadant's Big Move: Acquiring Key Knife For $156M To Fortify Wood Product Industry Solutions

Kadant Inc. -0.67%

Kadant Inc.

KAI

281.99

-0.67%

Kadant Inc (NYSE:KAI) disclosed a deal to acquire Key Knife, Inc. and certain of its affiliates for around $156 million in cash.

Founded in 1986, Key Knife is a global supplier of engineered knife systems for custom chipping, planing, and flaking solutions for wood product industries. The company is headquartered in Tualatin, Oregon, with 141 employees located primarily in the U.S. and Canada.

Key Knife's revenue for the trailing twelve months ended September 30, 2023, stood at about $65 million, and it will become a part of Kadant's Industrial Processing reporting segment.

Jeffrey L. Powell, president and chief executive officer, said, "With its strong aftermarket business and focus on providing highly engineered knife systems, Key Knife will broaden our product portfolio and strengthen our position in wood processing industries."

The acquisition is expected to close in early January 2024, subject to the customary closing conditions.

The company plans to finance the buyout primarily through borrowings under its revolving credit facility.

As of September 30, KAI's cash, cash equivalents, and restricted cash came in at $79.1 million.

Price Action: KAI shares closed lower by 0.40% at $284.23 on Thursday.

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