Environmental and safety solutions provider Federal Signal Corporation (FSS) recently announced that it has signed a definitive agreement to acquire Ground Force Worldwide, a manufacturer of specialty material handling vehicles, for $45 million in cash. The company expects the deal to close in the fourth quarter of 2021.
Following the news, shares of the company declined marginally to close at $39.88 on Wednesday.
With revenues of about $34 million in the past twelve months, the acquisition of Ground Force Worldwide will strengthen Federal Signal’s position as a diversified industrial manufacturer of specialized vehicles for maintenance and infrastructure markets.
The CEO of Federal Signal, Jennifer L. Sherman, said, “The acquisition augments our current materials hauling portfolio by adding a range of specialty vehicles that support the extraction of metals, demand for which is expected to benefit from vehicle electrification and other green initiatives. We are thrilled to welcome Ground Force’s talented team members to the Federal Signal family.” (See Federal Signal stock chart on TipRanks)
The stock has a Moderate Buy consensus rating based on 1 Buy. Last week, Sidoti analyst Gregory Burns upgraded the stock to a Buy with a price target of $50 (25.4% upside potential) as the analyst believes that the federal infrastructure bill can aid the company’s growth. Shares of the company have gained 27.9% over the past year.
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