Bel Fuse to acquire Emerson Network Power Connectivity Solutions for $98 million, its third major acquisition in the past 14 months.
Bel Fuse Inc. announced it has entered into a definitive agreement to acquire the Emerson Network Power Connectivity Solutions (ECS) business of Emerson Inc. Bel will pay approximately $98 million in cash to acquire the ECS business, which had 2013 revenue of approximately $83 million. The acquisition, which is subject to regulatory clearance and other customary closing conditions, is expected to close in the second quarter of 2014 and to be immediately accretive to Bel’s earnings.
Dan Bernstein, Bel’s president, said, “This is Bel’s third major acquisition in the past 14 months; all together, these acquisitions will increase our revenue from $283 million, pre-acquisition, to approximately $705 million annually. We are proud that Emerson Inc., ABB Ltd., and TE Connectivity Ltd. have determined in the best interest of their shareholders, customers, and employees to entrust these businesses to Bel and we look forward to growing these organizations.”
ECS is headquartered in Bannockburn, Ill., and has manufacturing facilities in North America, the UK and China, with a total of 525 employees worldwide. ECS is a leading provider of high-performance RF/microwave and harsh environment optical connectors and assemblies for military, aerospace, wireless communications, data communications, broadcast, and industrial applications. ECS has a global sales footprint and a diverse customer base that includes some of the world’s largest manufacturers coupled with an extensive distribution network populated with today’s premier electronic distributors. The ECS division comprises the following brands: Stratos optical technologies, Johnson, Trompeter, Midwest Microwave, Semflex, Vitelec Electronics, AIM Electronics, and Cambridge Products.
“The acquisition of ECS is a major step forward in our strategy to expand into the aerospace and military markets, where long-term product reliability resulting from highly engineered solutions is a key,” Bernstein added. “The addition of the ECS Stratos brand with our Fibreco/Gigacom interconnect products will give us an industry-leading position in the expanded beam fiber optic marketplace. The ECS group also significantly expands our copper-based product offering with the addition of RF/microwave connectors and assemblies. Bel is eagerly anticipating the many growth opportunities that will be created through this transaction, and we look forward to continuing to build an industry-leading high-reliability interconnect business with our new colleagues at ECS.”
Bel has obtained a commitment for financing provided by KeyBank National Association that, combined with available liquidity, is sufficient to fund the acquisition. Needham & Company LLC is serving as exclusive financial advisor; KeyBanc Capital Markets Inc. is serving as debt advisor; and DeCotiis, FitzPatrick & Cole LLP is acting as Bel’s legal counsel in the transaction.
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