Midwich enters US market with acquisition
Distributor buys AV VAD Starin Marketing for $46m
UK AV distributor Midwich has entered the US market for the first time with its purchase of VAD Starin Marketing for $46m (£35.6m).
Buying Starin gives Midwich a foothold in the "world's largest AV market" and provides a foundation for further expansion in the US, as well as strengthening its presence in the unified comms segment of the AV market.
Indiana-based Starin was founded in 1988 and has a headcount of 70. It reported unaudited revenue of $222.7m for the year ending 31 December 2019, with gross profit of $29.6m and EBITDA of $6.1m.
The $46m deal consists of a $27.1m cash consideration and an assumption of up to $19m in existing debt facilities.
The AIM-listed company has been on an M&A spree in the past 12 months, entering the Nordics, Italy and Switzerland for the first time via acquisitions, as well as strengthening its position in Spain with the purchase of Prase and Entertainment Equipment Supplies.
"The acquisition of Starin Marketing is a significant day in Midwich group's history, marking our entry into North America, the largest AV market in the world," stated Stephen Fenby, MD of Midwich group.
"Starin's exposure to, and relationships in, the growing unified communications segment will be greatly beneficial to Midwich as it seeks to increase revenues in this fast-growing AV sub sector across its global network. The highly experienced management team has built a great business and I look forward to welcoming them and the wider team into the Midwich group.
"Outside the acquisition, 2019 was another year of good growth for Midwich, despite negative sentiment in the global economy. The group delivered a robust organic performance from existing businesses and significant contributions from the acquisitions made throughout 2018 and 2019.
"We have been pleased with the integration of the four businesses acquired during 2019 which have enhanced both our geographic and product coverage and are all trading to plan."