Thomas H Lee Partners to acquire business from Brooks Automation in $3bn deal

December 2021 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

December 2021 Issue

Private equity (PE) firm Thomas H Lee Partners has entered into a definitive agreement to acquire Brooks Automation’s Semiconductor Solutions Group business in a deal valued at $3bn.

The transaction is expected to close in the first half of 2022, subject to the satisfaction of certain customary closing conditions and regulatory approvals.

“We are proud of the highly innovative automation business that we have built, which has seen great success in the semiconductor industry,” said Steve Schwartz, president and chief executive of Brooks. “We look forward to its continued growth under THL’s ownership. We are equally proud of the strength and growth of our life sciences business and excited by the significant proceeds from this transaction which will afford strategic investments in a market where we see tremendous opportunity.”

“We are excited to be joining forces with THL, with whom we share a vision for the future of our business,” says David Jarzynka, president of Brooks Automation. “We are proud of the leadership position we’ve established in our industry, and THL’s resources and automation expertise will further strengthen our platform as we enter our next phase of growth.”

“Over the past 40 years, Brooks has built an impressive portfolio of automated solutions to address some of the most difficult engineering challenges facing the semiconductor capital equipment industry,” said Michael Kaczmarek, managing director of Thomas H Lee. “We are excited to support the business in its next leg of growth in semiconductor and beyond.

“As the number one player in vacuum robot automation and contamination control solutions, Brooks Automation is a natural fit for our portfolio of market-leading automation platform companies,” he continued. “We look forward to working with Brooks Automation to increase investment, enhance its technology leadership position and further expand its best-in-class product portfolio.”

“THL remains focused on investing behind automation leaders, as underscored by the establishment of our Automation Fund in 2020, and working with management to accelerate growth,” said Jim Carlisle, managing director and head of Thomas H Lee’s automation fund. “We welcome the Brooks semiconductor and multi-market collaborative automation team into our family of dynamic and innovative automation solution providers, and we look forward to partnering with the talented team from Brooks Automation to unlock new growth opportunities.”

Following completion of the sale, the semiconductor automation business will transition to the ownership of Thomas H Lee along with the Brooks Automation name and brand. The remaining life sciences business will then operate as a standalone publicly traded life sciences company, under a new name to be announced in the near future.

Since 1974, Thomas H Lee Partners has raised more than $30bn of equity capital, invested in over 160 companies and completed more than 500 add-on acquisitions representing an aggregate enterprise value at acquisition of over $210bn. The firm invests in automation companies through its flagship private equity fund and a dedicated automation fund.

Brooks’ automation business recorded revenue of $613m in the 12 months to the end of June, which compares with total group revenue of about $1.1bn over the same time, according to FactSet data.

The deal for Brooks Automation comes amid a period of growth for the semiconductor industry. The proliferation of 5G technology, developments within the industrial internet of things (IoT) space, the increased focus on autonomous vehicles and artificial intelligence are expected to drive semiconductor industry revenue over the next decade. As a result, semiconductor manufacturers are investing heavily in new automation and robotics equipment to maximise production capacity.

Richard Summerfield