Charlotte’s Spartan Motors has announced the sale of its emergency response segment to REV Group Inc. in Wisconsin. REV paid about $55 million in cash at closing, which is subject to net working capital adjustment, and assumed certain liabilities of the emergency response segment. The transaction was unanimously approved by Spartan’s board of directors.
“The divestiture of the ER business unit will give us the speed and flexibility needed to further focus on accelerating growth and profitability in our commercial, fleet, delivery, and specialty vehicles markets, where we see the biggest opportunity to generate higher returns,” says Daryl Adams, president and CEO of Spartan.
“By freeing up additional resources and capital to better serve our target markets and make additional strategic investments, we can continue to evolve to meet the needs of our customers and provide long-term value to our shareholders.”
The business unit had revenue of about $253.3 million for the 12 months ended Sept. 30. Proceeds from the sale, effective Feb. 1, will be initially used to pay down debt and support working capital requirements. As part of the transaction, REV has purchased the rights to the Spartan brand name.
Accordingly, Spartan will change its corporate name in the coming months, subject to shareholder approval. REV has licensed the Spartan name and the Spartan diamond logo back to Spartan Motors for use in the company’s RV chassis business.
“E-commerce, electrification, and autonomous technologies are driving dramatic change in the industry, and this action positions us to continue to provide leading solutions for our customers,” Adams says. “I appreciate the dedication of our ER associates over the past 45 years, and I wish them success.”
Spartan offers specialty vehicle manufacturing and assembly for the commercial and retail vehicle industries, including last mile delivery, specialty service, and vocation-specific upfit segments, as well as for the recreational vehicle markets.
The company is organized into two core business segments: Spartan Fleet Vehicles and Services, and Spartan Specialty Vehicles. Its family of brands also includes Utilimaster, Royal Truck Body, Strobes-R-Us, Spartan Chassis, Spartan Authorized Parts, Spartan Authorized Service Centers, and Spartan Factory Service Centers. Spartan employs about 2,500 associates and operates facilities in Michigan, Indiana, Pennsylvania, South Carolina, Florida, Missouri, California, Arizona, Texas, and Mexico.