Olin Corporation (NYSE: OLN) has recently announced the completion of its acquisition of the small caliber ammunition assets of Ammo, Inc. This acquisition includes the brass shellcase capabilities and a newly constructed, 185,000 square foot production facility located in Manitowoc, Wisconsin, now part of Olin's Winchester Ammunition business.
Funded from available liquidity, the transaction is anticipated to be immediately accretive to Olin’s shareholders. It is expected to deliver incremental first-year adjusted EBITDA of $10 to $15 million, including synergies realization, leveraging Winchester's industry-leading economies of scale, raw material sourcing, and projectile, primer, and loading capabilities.
Once fully integrated, the acquisition is projected to yield adjusted EBITDA of $40 million per year with full realization of synergies. Olin’s President and CEO, Ken Lane, emphasized the strategic nature of the acquisition in line with the company’s capital allocation framework. He highlighted the alignment of this acquisition with Olin's Winchester strategy and its immediate accretive nature.
Brett Flaugher, President of Winchester Ammunition, emphasized that the specialization of the Manitowoc facility will expand their reach into higher-value commercial and international military and law enforcement calibers. This expansion is expected to deepen their integration across the ammunition value chain.
Olin Corporation is a leading globally integrated manufacturer and distributor of chemical products, as well as a prominent U.S. manufacturer of ammunition. Its subsidiary, Winchester, operates as a principal manufacturer and distributor of various types of ammunition, including sporting ammunition, law enforcement ammunition, and small caliber military ammunition and components. The market has reacted to these announcements by moving the company's shares 2.6% to a price of $20.89. For more information, read the company's full 8-K submission here.
