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RPM International (RPM) Acquires Bison, Boosts Fibergrate Unit

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RPM International Inc.’s RPM Fibergrate Composite business unit has acquired Bison Innovative Products, a supreme manufacturer of raised flooring systems. However, the financial terms of the transaction have been kept under wraps.

Bison is headquartered in Denver, CO, and has annual net revenues of around $26 million. It offers a range of flooring products that are used for rooftop decks, plazas, terraces, pop-up-parks and other architectural features requiring maintenance-free pedestals and low-maintenance deck surfaces. The company’s products are manufactured in the United States and disbursed all over North America. Together with RPM International’s Fibergrate business, Bison will provide solutions for industrial and commercial applications.

With respect to this, RPM International's chairman and CEO, Frank C. Sullivan, said, “Through this transaction, we plan to enhance Bison’s distribution base, allowing the business to enter new geographies and markets. At the same time, we expect to leverage its connections to achieve greater penetration of Fibergrate’s products.”

Acquisitions Driving Growth

RPM International follows a systematic inorganic strategy to enhance its portfolio. Acquisitions have been an important part of RPM International’s growth strategy. The company made three buyouts in fiscal 2020, five in fiscal 2019 and seven in fiscal 2018. Acquisitions added 1.1% to its net sales in fiscal 2020 and 1.4% in fiscal 2019. In the first six months of fiscal 2021, acquisitions contributed 1.4% to sales.

In September 2020, RPM International’s Rust-Oleum business acquired a leading manufacturer of sandpaper and other abrasives, Ali Industries, LLC (which is commercially known as Gator Finishing Products). Ali Industries is an excellent fit for RPM International’s Consumer Group segment as it enhances the unit’s surface preparation capabilities by adding abrasives to its lineup of patch, repair and cleaning products.

On Dec 18, 2019, RPM International announced that its Mantrose-Haeuser business unit acquired Elgin, IL-based manufacturer of dry stabilizer and emulsifier blends for the food industry — Profile Food Ingredients, LLC. The buyout creates significant opportunities to leverage the combined sales forces of the entities, expand sales of specialty ingredients to the food industry and broaden RPM International’s reach in international markets.

RPM International’s shares have gained 15% in the past six months compared with the industry’s 10.2% rally. On a further encouraging note, the company has a robust earnings surprise history, having surpassed the Zacks Consensus Estimate in 8 of the trailing 10 quarters. The company has been benefiting from strong demand for commercial sealants and roofing in North America, regular acquisitions, favorable product mix, and moderation in some raw material categories.

Zacks Rank

RPM International — which shares space with The Sherwin-Williams Company SHW, TopBuild Corp. BLD and Owens Corning OC in the Zacks Construction sector — currently carries a Zacks Rank #4 (Sell).

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