Federal Signal Completes Acquisition of Hog Technologies, A Leading U.S. Manufacturer of Road-Marking, Line-Removal and Waterblasting Equipment

Rhea-AI Summary

Federal Signal (NYSE: FSS) has completed the acquisition of Hog Technologies for an initial purchase price of $78.1 million, with a potential earn-out of up to $15 million based on 2025 financial targets. The company has also agreed to acquire Hog's manufacturing facility in Stuart, Florida for $14.5 million.

Hog Technologies, founded in 1988, is a leading U.S. manufacturer of truck-mounted road-marking, line-removal, and waterblasting equipment. The company generated annual revenues of $65 million in 2024, with aftermarket parts and services accounting for 35% of total revenues. Hog's product portfolio includes patented rubber- and paint-removal systems, pavement-marking and grinding trucks, and advanced waterblasting units.

The acquisition aligns with Federal Signal's strategic priorities to grow its specialty vehicle platform and strengthen its position in infrastructure maintenance. The transaction, completed on February 12, 2025, is expected to be accretive to earnings and cash flow in 2025.

Positive

• Acquisition expected to be accretive to earnings and cash flow in 2025
• Target company has $65 million in annual revenue (2024)
• Strong aftermarket business representing 35% of total revenues
• Patented technology and equipment designs
• Strategic expansion into infrastructure maintenance sector

Negative

• Significant initial cash outlay of $92.6 million (including facility)
• Increased debt through use of revolving credit facility
• Additional contingent payment liability of up to $15 million

News Market Reaction – FSS

-2.43%

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-2.43% News Effect

On the day this news was published, FSS declined 2.43%, reflecting a moderate negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

DOWNERS GROVE, Ill., Feb. 12, 2025 /PRNewswire/ -- Federal Signal Corporation (NYSE: FSS) ("Federal Signal" or the "Company"), a leader in environmental and safety solutions, today announced that it has completed the acquisition of substantially all the assets and operations of Waterblasting, LLC, owner of Hog Technologies ("Hog"), a leading U.S. manufacturer of truck-mounted road-marking, line-removal, and waterblasting equipment for an initial purchase price of $78.1 million. The initial purchase price, which was funded through existing cash on hand and borrowings under the Company's revolving credit facility, is subject to certain customary adjustments for working capital and debt-like items. In addition, there is a contingent earn-out opportunity of up to $15 million, based on the achievement of specified financial targets during 2025. Additionally, Federal Signal has entered into a definitive agreement to acquire Hog's primary manufacturing facility in Stuart, Florida for $14.5 million. 

Founded in 1988, Hog has established itself as a leading innovator serving infrastructure, municipal and airport markets, with a broad portfolio of products, including rubber- and paint-removal systems, pavement-marking and grinding trucks, and advanced waterblasting units. Hog has secured a leading position in the industry through its patented equipment designs, deep product expertise, technology leadership, and understanding of the specific requirements of its customers. One of Hog's unique innovations is a patented runway rubber-removal system, which is widely recognized and used by major airports across the globe.

"Our 150 team members take exceptional pride in manufacturing our suite of Hog products that keep our communities, highways and airport runways safe," said Vince Giordano, Hog's President. 

"This acquisition is aligned with our strategic priorities of growing our best-in class specialty vehicle platform," said Jennifer L. Sherman, President and Chief Executive Officer. "Hog's product portfolio, experienced and talented management team, and strong presence in international and airport markets provide a unique opportunity to strengthen our leadership in the infrastructure maintenance sector, broaden our product offerings and unlock future growth opportunities. We are particularly excited about the synergies this transaction creates within our existing road-marking, line-removal, and waterblasting offerings. We also believe that Hog's technological advancements and expansive aftermarket parts and service business will enable Federal Signal to better serve our customers in the future."

"Federal Signal has been a valued long-term vendor and partner. We are excited to join forces to launch the next phase of growth at Hog," said James P. Crocker, Founder and CEO, Hog Technologies. "This partnership is a natural cultural fit with both companies exhibiting a shared vision of providing excellent customer service and maintaining strong local community connections."

Hog generated annual revenues of approximately $65 million in 2024, with aftermarket parts and services representing approximately 35% of total revenues.

The transaction closed on February 12, 2025. The Company expects the acquisition to be accretive to earnings and cash flow in 2025. Management will issue its 2025 outlook, including the impact of Hog, later this month during its fourth quarter 2024 earnings call. 
                       
About Federal Signal       
Federal Signal Corporation (NYSE: FSS) builds and delivers equipment of unmatched quality that moves material, cleans infrastructure, and protects the communities where we work and live. Founded in 1901, Federal Signal is a leading global designer, manufacturer, and supplier of products and total solutions that serve municipal, governmental, industrial, and commercial customers. Headquartered in Downers Grove, Ill., with manufacturing facilities worldwide, the Company operates two groups: Environmental Solutions and Safety and Security Systems. For more information on Federal Signal, visit: www.federalsignal.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

This release contains various forward-looking statements as of the date hereof and we undertake no obligation to update these forward-looking statements regardless of new developments or otherwise. Statements in this release that are not historical are forward-looking statements. Such statements are subject to various risks and uncertainties that could cause actual results to vary materially from those stated. Such risks and uncertainties include but are not limited to: economic and political uncertainty, risks and adverse economic effects associated with geopolitical conflicts, legal and regulatory developments, foreign currency exchange rate changes, inflationary pressures, product and price competition, supply chain disruptions, availability and pricing of raw materials, interest rate changes, risks associated with acquisitions such as integration of operations and achieving anticipated revenue and cost benefits, work stoppages, increases in pension funding requirements, cybersecurity risks, increased legal expenses and litigation results and other risks and uncertainties described in filings with the Securities and Exchange Commission.

View original content:https://www.prnewswire.com/news-releases/federal-signal-completes-acquisition-of-hog-technologies-a-leading-us-manufacturer-of-road-marking-line-removal-and-waterblasting-equipment-302374807.html

SOURCE Federal Signal Corporation

FAQ

How much did Federal Signal (FSS) pay for Hog Technologies?

Federal Signal paid an initial purchase price of $78.1 million for Hog Technologies, plus $14.5 million for their manufacturing facility, with an additional potential earn-out of up to $15 million based on 2025 performance targets.

What was Hog Technologies' revenue in 2024 before the FSS acquisition?

Hog Technologies generated annual revenues of approximately $65 million in 2024, with aftermarket parts and services representing 35% of total revenues.

When did Federal Signal (FSS) complete the Hog Technologies acquisition?

Federal Signal completed the acquisition of Hog Technologies on February 12, 2025.

How will the Hog Technologies acquisition impact FSS financial performance?

The acquisition is expected to be accretive to Federal Signal's earnings and cash flow in 2025.

What products does Hog Technologies bring to Federal Signal's portfolio?

Hog Technologies brings truck-mounted road-marking, line-removal, and waterblasting equipment, including patented rubber- and paint-removal systems, pavement-marking and grinding trucks, and advanced waterblasting units.