Tenneco Automotive has acquired most assets of Gabilan Manufacturing, Inc., a privately held company that has developed and manufactured motorcycle exhaust systems exclusively for Harley-Davidson motorcycles since 1978.
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Gabilan, which reported $US38 million in revenues in 2004, is the exclusive muffler manufacturer for all of Harley-Davidson’s motorcycle lines.
Based in Salinas, California, the company also produces aftermarket muffler kits solely for Harley-Davidson. Tenneco Automotive has reached a long-term supply agreement with Harley-Davidson to continue these relationships.
“This acquisition is the first in our company’s five-year history and represents another execution of our consistent strategy to grow through niche opportunities said Tenneco Automotive chairman and chief executive officer Mark Frissora.
Tenneco Automotive purchased Gabilan’s assets for $10 million in cash and expects the acquisition to be accretive within the first year. The acquisition is effective immediately.
As part of the acquisition agreement, Tenneco Automotive is acquiring nearly all the assets of Gabilan Manufacturing but not the name, real estate at Salinas, California, its discontinued farm equipment or other businesses or certain liabilities associated with the exhaust business.
Tenneco Automotive will lease the facility in Salinas and will assume the current leasing agreements at the other Gabilan facilities.
The business has about 240 employees, the majority of which are located at the California headquarters and main manufacturing facility in Salinas. The company also operates three other facilities in Lincoln, Nebraska, Milwaukee, Wisconsin and Emigsville, Pennsylvania.
