Good evening,

Sydney’s Alceon Private Equity has agreed terms to acquire 50 per cent of Boss Engineering, the No.1 manufacturer of planting equipment in NSW and Queensland, which posted $28 million earnings last financial year.

Street Talk can reveal Alceon will buy in at a $175 million valuation, representing a 5.3-times multiple of EBITDA forecast for the 12 months to June 30. The mid-market PE investor will become a co-investor alongside Boss’s founders Andrew English, Michael Grills and Dan Ryan. The sellers were advised by Miles Advisory.

Boss’s core business is building robotic seeding and planting equipment for agricultural customers on the East Coast – think planters, seeders, air carts and cultivators. Its Inverell-based facility also manufactures spare parts and consumables, and ute trays and trailers.

All up, that totalled $70 million revenue in the 2023 financial year, while the business has averaged 30 per cent EBITDA margin for the past three years. Market share stands at 29 per cent in NSW and 15 per cent in Queensland.

The deal is structured as preference shares, with downside protection and board control for Alceon, as well as incentives for Boss’s management to beat target forecasts.

It comes after Alceon’s PE co-heads, Zac Midalia and David Wilshire, in October delivered a net 80 per cent IRR to their backers at Nido Education. The childcare roll-up raised $99 million for its IPO bookbuild, in what ended up as 2023’s second-biggest float.

They’ll be hoping for similar luck at Boss, come exit time.

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Alceon Private Equity expects Boss Engineering’s gross income to cross $142 million by the 2028 financial year, which would translate to about $53 million EBITDA. Future growth will be underwritten by expansion into Victoria, South Australia and WA, outside its home markets of NSW and Queensland.

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