Mercury Systems, Inc.., (NASDAQ: MRCY) has acquired Pentek Technologies, LLCand Pentek Systems, Inc. (together with Pentek).
Based in Upper Saddle River, NJ, Pentek is a leading designer and manufacturer of robust, high-performance, Commercial off the shelf (CHILDREN’S) software defined radio (SDR) and data collection boards, recording systems and subsystems for high – end commercial and defense applications.
Under the terms of the purchase agreement, Mercury acquired Pentek for a purchase price of $ 65.0 million, subject to an adjustment to net working capital and net debt. Part of the acquisition is expected to be treated as a sale of an asset for tax purposes.
Acquisition costs and related transactions were financed through a combination of cash and Mercury’s existing revolving credit facility. For Mercury’s fiscal year, ending July 1, 2022, Pentek is expected to generate revenue of about $ 20 million with profit margins in line with Mercury’s. The acquisition is expected to take effect immediately for the adjusted EPS.
“The acquisition of Pentek is a great fit for our market and a low-risk content expansion strategy.,” said Mark Aslet, President and CEO of Mercury. “Their capabilities add scale and breadth to the existing portfolio of mixed-signal products and deepen our penetration of our core radars, electronic warfare (EW) and intelligence market signals. Like our previous acquisitions in the radio frequency and microwave domains, the acquisition of Pentek not only provides important new opportunities for our customers; this also allows us to increase the size of our common address market. We are very pleased to welcome the Pentek team to Mercury. ”
“I am thrilled to be able to bring new features to the impressive mix of pre-integrated Mercury subsystems in support of multiple aerospace and defense programs and platforms.,” said Roger Hosking, Vice President, Pentek. “Our business-oriented business model will provide a diverse portfolio of building blocks, allowing low-risk content expansion at the module and subsystem level. In addition, there is an excellent strategic and cultural fit between the two businesses with a common focus on innovation that matters.. “