Columbus McKinnon Divests Power Chain Hoist Operations to Streamline and Enhance Efficiency

Columbus McKinnon Streamlines Operations with Strategic Divestiture

Columbus McKinnon Corporation, a leading designer and manufacturer of intelligent motion solutions for material handling, announces a pivotal move to divest its U.S. power chain hoist and chain manufacturing operations based in Damascus, Virginia, and Lexington, Tennessee. This strategic decision involves selling the operations to Pacific Avenue Capital Partners, LLC for $210 million, with the potential for an additional $25 million in earn-outs. This transaction, expected to finalize in the first quarter of 2026, represents a significant step in Columbus McKinnon's efforts to streamline its portfolio, particularly in light of its impending acquisition of Kito Crosby Limited.

The divestiture aims to eliminate product redundancies that may arise from the integration of Kito Crosby, which aligns with Columbus McKinnon's goal of enhancing customer value and improving operational efficiency across its diverse end markets. David Wilson, President and CEO of Columbus McKinnon, emphasizes that simplifying operations through this divestiture allows for a more effective acquisition process. By consolidating resources and capabilities from both companies, Columbus McKinnon is poised to deliver a stronger value proposition to its customers, ultimately benefiting all stakeholders involved in this transition.

Financially, Columbus McKinnon anticipates receiving approximately $160 million in cash from the divestiture, which will primarily be used to reduce debt associated with the Kito Crosby acquisition. The company projects an achievement of $70 million in annual net run rate cost synergies due to its preparation for integration. Additionally, Columbus McKinnon aims to lower its Net Leverage Ratio to below 4.0x by the end of fiscal 2028, supported by robust cash flow generation following the acquisition. This strategic realignment not only positions Columbus McKinnon for future growth but also reinforces its commitment to operational excellence and customer satisfaction.

In related developments, Columbus McKinnon has released preliminary financial estimates for the third quarter ending December 31, 2025. The company expects net sales to range between $250 million to $260 million for the quarter, while adjusted EBITDA is projected to be between $38 million and $40 million. Furthermore, Columbus McKinnon forecasts a decline in orders received during the quarter, estimating between $245 million and $250 million, compared to the previous quarter's $253.7 million. These estimates, however, do not consider the effects of the Kito Crosby acquisition or the recent divestiture, indicating that further disclosures will be necessary for a comprehensive understanding of the company’s financial health moving forward.