Alliance Laundry Holdings Inc. IPO – What You Need to Know

Hey there! Thinking about investing in the Alliance Laundry IPO? Let’s break it down in plain English so you know exactly what you’re getting into.

1. What does this company actually do?

Alliance Laundry makes big, industrial-sized laundry machines. Think of the heavy-duty washers and dryers you see in laundromats, hotels, colleges, or hospitals. They’re not selling the cute little machines for your basement—this is the “workhorse” stuff businesses rely on.

Key Strengths:

• Market Leader: Twice as big as their next competitor, with 8 million machines in use worldwide (that’s like 1 machine for every 1,000 people on Earth!).
• Essential Services: Their machines keep hospitals, fire stations, and hotels running. If a hospital’s laundry breaks down, they can’t sterilize linens—this isn’t just about clean socks!
• Trusted Brands: They own Speed Queen, UniMac, Huebsch, IPSO, and Primus – the “Nike” of commercial laundry gear.

2. How do they make money, and are they growing?

They sell laundry equipment (their main cash cow) and also make money from parts, repairs, and service contracts.

Growth Drivers:

• 15-Year Hot Streak: Revenue has grown 9.5% annually since 2009 – turning $10,000 into $40,000 in 15 years!
• Global Expansion: Laundromats are booming in emerging markets like Thailand (50% annual growth there since 2017) and going upscale in the U.S./Europe.
• Tech Upgrades: $100+ million spent on R&D since 2020 to build longer-lasting machines.

2024 Financial Snapshot:

• $1.5 billion in sales
• $98 million profit (7% margin)
• $383 million in Adjusted EBITDA (25.4% margin, up yearly)

Watch Out For:

• Rising interest payments ($132 million in 2024, up 7% from 2023).
• Their “Adjusted EBITDA” excludes costs like stock bonuses and pension closures – think of it as a “cleaned up” profit number.

3. What will they do with the IPO money?

• Pay down debt (their #1 priority).
• Invest in tech (like AI quality control) and factory automation.
• Expand global factories (they’re the only commercial laundry maker in North America, Europe, and Asia).

Fine Print:

• Part of the IPO cash goes to early investor BDT Capital Partners, not the company.
• BDT will control 60-70% of voting power post-IPO, meaning they can outvote smaller investors.

4. What are the main risks?

• Debt Burden: $132 million in interest payments in 2024, with total debt refinanced recently.
• Economic Sensitivity: Sales depend on global GDP growth, consumer credit, and fuel prices. A recession could slow laundromat demand.
• Cybersecurity Threats: They handle customer data through apps and financing programs – a breach could mean fines or lost trust.
• Majority Control: BDT Capital’s voting power lets them ignore some shareholder-friendly rules (like independent board members).

5. Final Thought

Alliance Laundry isn’t flashy, but it’s a steady player in an essential industry. If you like businesses with 15 years of growth, global reach, and trusted brands – and can stomach the debt and control risks – this might fit your portfolio. Just remember: IPOs can be volatile, and the big investor calls the shots here.

P.S. Always do your own research or talk to a financial advisor before investing!