Gabelli & Company Reiterates Buy Rating on Zep
In a report published Friday, Gabelli & Company reiterated its Buy rating on Zep (NYSE: ZEP).
Gabelli & Company noted, “Effective December 1, 2012, Zep completed the acquisition of Ecolab Vehicle Care business from Ecolab. We continue to recommend shares of Zep and believe shares are attractively priced: As part of the transaction, Zep purchased all of the assets of Ecolab Vehicle Care for approximately $120 million, or 9.2x EBITDA. Sales and adjusted EBITDA for Ecolab's vehicle care division for the trailing 12 months ending June 30, 2012 were approximately $66 million and $13 million, respectively. The acquisition fits with Zep's strategy of growing its transportation business, especially in the distribution and corporate channels. Through the deal, Zep will gain scale as well as new corporate accounts and distribution customers.”
Zep closed on Thursday at $13.00.
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