TRG | The Bottom Line – 9/3

As we look forward to a little R&R on Labor Day weekend, M&A activity continues to dominate headlines. This past week top RV manufacturer Thor Industries (NYSE: THO) announced its largest acquisition yet. Thor on 9/1 announced the acquisition of Airxcel for $750MM cash at a 7.6x EBITDA multiple. Airxcel is an RV supplier of parts and accessories across air conditioners, water heaters, furnaces, and other appliances. This acquisition is significant not just because of its size but also what this signals in terms of a growing trend of vertical integration. Given ongoing global supply chain disruptions and what appears to be a structural change in how domestic manufacturers think about their own supply chain, many companies are opting to think differently about accessing key materials and products. Against that backdrop, RV manufacturers have been hamstrung with the delivery of products because of key missing parts (including appliances). Thor’s acquisition of Airxcel is one step closer to helping Thor ease that supply chain gap.