In a significant move for the performance automotive aftermarket, Holley, a renowned name for car parts and performance solutions, has announced a definitive merger agreement with Empower Ltd. (NYSE: EMPW), a special purpose acquisition company. This transaction, valuing Holley at an enterprise value of approximately $1.55 billion, will see Holley become a publicly listed company on the New York Stock Exchange (NYSE) under the ticker symbol “HLLY”.
This strategic maneuver will inject substantial capital into Holley, primarily known for its extensive range of Holley Car Parts and performance brands. The merger is financed through a combination of $250 million from Empower’s trust account, a $50 million forward purchase agreement, and a $240 million PIPE (Private Investment in Public Equity). Major investors like Wells Capital Management and Wasatch Global Investors are participating in this PIPE, signaling strong confidence in Holley’s future. The proceeds are earmarked for fueling Holley’s growth initiatives, significantly reducing existing debt, bolstering marketing efforts, and enhancing working capital. Post-transaction, the combined entity is projected to have approximately $485 million of net debt.
Sentinel Capital Partners, L.L.C., the current majority stakeholder in Holley, will remain the largest shareholder after the deal closes, indicating continued stability and vision for the company. Established in 1903, Holley has grown into a leading designer, marketer, and manufacturer in the high-performance automotive aftermarket. The company boasts an impressive portfolio of iconic brands catering to car and truck enthusiasts seeking top-tier Holley car parts and performance upgrades. Holley’s brand family includes leaders in electronic fuel injection (Holley EFI), electronic tuning (APR, DiabloSport, Edge, and Superchips), electronic ignition (MSD and ACCEL), carburetion (Holley), and exhaust systems (Flowmaster and Hooker), alongside safety equipment (Simpson and Stilo) and other crucial product categories for automotive performance. Holley’s estimated net sales for the fiscal year ending December 31, 2020, reached $583 million, demonstrating its robust market presence and the high demand for Holley car parts.
Empower Ltd., the merger partner, is a blank check company formed by MidOcean Partners with the specific aim of merging with a promising business. Empower successfully raised $250 million in its initial public offering in October 2020 and is currently listed on the NYSE under the ticker “EMPW.” This merger represents a significant step for both Holley and Empower, positioning Holley to further expand its reach in the automotive aftermarket and continue innovating in Holley car parts and performance solutions for enthusiasts worldwide.
