McLaughlin family sells New Way Trucks to Federal Signal

The McLaughlin family has signed a definitive agreement to sell Iowa-based Scranton Manufacturing Co. Inc., New Way Trucks and the New Way Trucks brand. The company will be acquired by Federal Signal Corp., Downers Grove, Illinois, for an initial purchase price of $396 million.

“This is not a decision we made lightly,” Scranton Manufacturing CEO Mike McLaughlin. “As a family-owned business, this company has been part of our lives for nearly three generations. It has grown thanks to the hard work and dedication of our employees, distributors and partners and their belief in what we do. They are the heart of this company, and we are deeply grateful for everything they have contributed. Together, we have built this company to be the largest privately held manufacturer of refuse equipment in North America.”

Since 1971, Scranton Manufacturing and its New Way Trucks brand say they have been the largest privately held manufacturer of refuse equipment in North America. Originally manufacturing agricultural equipment for local farmers, the company pivoted to manufacturing refuse equipment following its acquisition of New Way Trucks in 1984. In the time since, the company has expanded to more than 75 employees, five factories and two states.

New Way manufactures a range of automated side loaders, front loaders and rear loaders at its two primary U.S. production facilities.

Federal Signal says the acquisition will support New Way’s continued growth while broadening the company’s footprint in the environmental services industry.

“We are excited to join the Federal Signal family and add New Way to their portfolio,” McLaughlin says. “It has always been important to my family that we provide for our employees, and partnering with Federal Signal allows for the very best opportunities for the entire New Way employee family. Our company’s culture has always been important to the success of the business and aligns perfectly with Federal Signal’s culture of growth, innovation and teamwork.”

As part of the acquisition, Federal Signal will pay additional consideration of $30 million for New Way’s manufacturing facilities and associated real estate rights in Iowa and Mississippi. Federal Signal says a contingent earn-out up to $54 million is possible based on the achievement of specified financial targets over a two-year period. It anticipates that the pro-forma net debt leverage ratio upon the acquisition’s completion will be less than 1.5x.

The transaction is expected to close before the end of 2025, with timing subject to customary closing conditions and regulatory approval.

“The acquisition of New Way establishes a new vertical within our specialty vehicle portfolio and represents a meaningful expansion into the recession-resilient waste and recycling industry,” Federal Signal President and CEO Jennifer L. Sherman says. “With our deep expertise in selling refuse equipment through our direct distribution channel and our ability to leverage the power of our specialty vehicle platform, we see significant opportunities to capture synergies and accelerate New Way’s growth and margin trajectory in coming years. Importantly, we believe New Way’s leading U.S. position in automated side loaders and for municipal sales sets the foundation for continued outperformance within the refuse space.

"We are excited to welcome New Way’s dedicated team of more than 750 employees to the Federal Signal family.”