RERMAG

United Buys Thomas Equipment, 18 Other Companies

GREENWICH, Conn - In its latest wave of acquisitions, United Rentals has acquired 19 companies, including aerial specialist Thomas Equipment, No. 31 on the RER 100, Coble Equipment & Rentals, No. 76, and six traffic safety equipment companies with about $110 million in combined annual revenue from 43 locations.

In the traffic safety segment, United acquired Phoenix-based Woudenberg Enterprises, with 15 locations in Arizona, Colorado and Nevada; WLI Industries, Villa Park, Ill., with 10 locations in Illinois, Indiana, Iowa and Missouri; Advance Barricades and Signing, Jupiter, Fla., with nine Florida and Georgia branches; six-location Warning Lites, Minneapolis; two-location Lectric Lites Co., Fort Worth, Texas; and one-location Precision Pavement Marking, Rogers, Minn.

"United Rentals is now the largest provider of equipment rental services to this rapidly growing sector," said chairman and CEO Brad Jacobs. "The traffic safety market should directly benefit from the Transportation Equity Act for the 21st Century (TEA-21), which provides about $210 billion in federal funding over five years for highways, roads, bridges and other transportation infrastructure projects."

After the Thomas deal, United closed a branch in Fontana, Calif., owner Randy Thomas, who will leave the industry after a brief transition period, told RER. The majority of the company's estimated $30 million in annual revenue is generated at headquarters in Modesto, Calif.

Ramsey Management Services, Prescott, Ariz., brokered the Thomas deal.

The deal for Coble gives United about $11.5 million in annual revenue from four branches in Charlotte, Greensboro, Raleigh and Winston-Salem, N.C. Former owner Tom Coble's son Matt will continue to manage the Raleigh branch.

United also acquired two-location A-1 Lincoln Rental-All, Mechanicsburg, Pa; Bishop's Equipment Rental, Tyler, Texas; Blount Rental, Louisville, Ky.; Gator Equipment, Orlando, Fla.; Hamilton Construction Equipment, Boston; McClanahan Rentals, Corsicana, Texas; Rent-A-Tool & Equipment, Stamford, Conn.; two-location Rent Way, League City, Texas; and Southern Fastening and Rentals, Florence, Ala.

Most recently, United acquired Knipper's Rental Center, with locations in Santa Ana and Los Alamitos, Calif. Knipper's, owned since 1978 by Rich Majchrzak, has an estimated $4 million in annual rental revenue. Majchrzak does not expect to stay on past the transition period.

Since January, United has acquired 64 companies with 239 locations. It now has more than 630 locations in 43 states, six Canadian provinces and Mexico.

FARGO, N.D - RDO Equipment Co. has hired an investment bank to explore strategic alternatives for RDO Rental Co., ranked No. 45 on the RER 100.

RDO chairman and CEO Ronald Offutt said the company will consider a sale or a possible joint venture for the rental division, of which RDO Equipment controls 80 percent. "We believe that this is an opportune time to assess various alternatives in the construction equipment rental industry," said Offutt, who added that there was no assurance that any transaction would take place.

Proceeds from any sale would be used to pay down debt and to invest in construction and agricultural dealerships, which "generate a higher return on investment than our existing construction equipment rental operations," Offutt said.

Deutsche Banc Alex. Brown will conduct the search for possible suitors, which is expected to take several months to complete.

"The rental industry has changed so radically in the last couple of years that RDO Equipment wants to make a decision to either commit more resources to the rental industry or put it into truck and equipment dealerships," said Bill Hutton, president and 20 percent owner of RDO Rental.

In 1997, Hutton sold an 80 percent stake in what was then five-location Sun Valley Equipment to RDO. The Cottonwood, Ariz.-based company now operates 12 locations in Arizona, California and Nevada with 1998 rental revenue of $24.6 million.

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