Latham Group, Inc. Form 8-K Summary
Business Context and Reporting Period
Latham Group, Inc. reported an acquisition and related financing transactions. The material event occurred on November 24, 2021, and the Form 8-K was filed on November 30, 2021. Latham Pool Products, Inc. and related subsidiaries are indirect wholly owned subsidiaries of Latham Group.
Key Financial and Transaction Metrics
- Acquisition: Latham Pool Products acquired all outstanding equity interests of Trojan Leisure Products, LLC, doing business as Radiant Pools.
- Purchase price: $90 million in cash, subject to customary adjustments for working capital, indebtedness, cash, and transaction expenses.
- Cash paid at closing: Approximately $88 million.
- Escrow: $0.9 million was placed with a third party in connection with purchase price adjustments.
- Incremental debt: The company borrowed $50 million under incremental term loans.
- Use of proceeds: The incremental term loans, together with cash on hand, funded the acquisition and related fees and expenses.
- Terms: The incremental term loans form a single class with existing term loans and have identical maturity, interest rate, amortization, and other terms. The filing text does not provide the specific maturity, interest rate, amortization schedule, or resulting total debt balance.
Material Changes Versus the Prior Comparable Period
The transaction increased the company’s outstanding term debt by $50 million and added Radiant Pools to the company’s operations. The filing text does not provide comparative revenue, earnings, cash flow, margin, or liquidity data.
Guidance, Outlook, Risks, and Unusual Items
- The filing does not provide formal financial guidance or quantified operating forecasts.
- The acquisition consideration remains subject to purchase price adjustments, including working capital and certain indebtedness, cash, and transaction expenses.
- The filing states that certain lenders and their affiliates provide, and may continue to provide, banking and other services to the company for customary fees.
- Portions of the Fifth Incremental Facility Amendment were omitted pursuant to Item 601(a)(v) of Regulation S-K; investors should review the complete filed agreement and incorporated credit documents for detailed covenants and restrictions.
Important Facts for Investors to Verify
- Review the full Fifth Incremental Facility Amendment for interest rate, maturity, amortization, covenants, collateral, and default provisions.
- Confirm the final acquisition purchase price after working-capital and other closing adjustments.
- Assess the impact of the Radiant Pools acquisition on consolidated revenue, profitability, cash flow, leverage, and liquidity in subsequent filings.
- Review the company’s next periodic report for purchase-accounting treatment, goodwill or intangible assets, and transaction expenses.