ALMELO, Netherlands,
July 30, 2015 /PRNewswire/ --
Sensata Technologies Holding N.V. (NYSE: ST) announced today that
it has reached an agreement to acquire the sensing portfolio of
Custom Sensors & Technologies, Inc. ("CST") for a total
enterprise value of $1.0 billion.
The acquisition includes the Kavlico, BEI, Crydom and Newall
product lines and brands and includes sales, engineering and
manufacturing sites in the United
States, the United Kingdom,
Germany, France, China
and Mexico that employ
approximately 2,500 people, including approximately 250 engineers.
Revenue for the business being acquired was approximately
$320 million during the last 12
months. The transaction is subject to customary regulatory
approvals and is expected to close in the fourth quarter of 2015 or
early 2016.
Kavlico is a significant provider of mission-critical linear and
rotary position sensors to aerospace OEMs and Tier One suppliers
and pressure sensors to the general industrial and HVOR
markets. BEI provides harsh environment position sensors,
optical and magnetic encoders and motion control sensors to the
industrial, aerospace, agricultural and medical device
markets. Crydom manufactures solid state relays for power
control applications in industrial markets. Newall provides
encoders and digital readouts to machinery and machine tool
markets.
"The acquisition of CST's sensing portfolio is in line with
Sensata's strategy to Win in Sensing. This acquisition further
extends our sensing content beyond automotive markets and builds
scale in pressure sensing," said Martha
Sullivan, Sensata Technologies President and Chief Executive
Officer. "These are long-standing sensing brands that are
well respected by leading OEMs. We are excited to welcome
this talented team into Sensata's global organization."
"On a stand-alone basis, this is a profitable and highly cash
generative business with EBITDA margins of approximately 26% and
Sensata brings significant, value-creating synergies," added
Paul Vasington, Sensata Technologies
Chief Financial Officer. "Including interest and integration
expenses, we expect this acquisition to be breakeven to adjusted
net income in the first full year and to be $0.23 to $0.26 accretive to adjusted net income
per diluted share in the third year."
Bank of America Merrill Lynch has committed to provide debt
financing to support the transaction. Lazard acted as
financial advisor and Kirkland & Ellis LLP acted as legal
advisor to Sensata Technologies.
Conference Call
Sensata Technologies will conduct a conference call today at
8:00 AM eastern time to discuss this
transaction. The U.S. dial in number is 877-486-0682 and the
non-U.S. dial in number is 706-634-5536. The passcode is
1172100. A live webcast and a replay of the conference call
will also be available on the investor relations page of the
Company's website at http://investors.sensata.com.
About Sensata Technologies
Sensata Technologies is one of the world's leading suppliers of
sensing, electrical protection, control and power management
solutions with operations and business centers in fifteen
countries. Sensata's products improve safety, efficiency and
comfort for millions of people every day in automotive, appliance,
aircraft, industrial, military, heavy vehicle, heating,
air-conditioning, data, telecommunications, recreational vehicle
and marine applications. For more information, please visit
Sensata's web site at www.sensata.com.
About Custom Sensors & Technologies
Custom Sensors & Technologies ("CST"), headquartered in
California, USA, is a global
specialist in designing and manufacturing sensors, controls and
actuators. Through its brands, BEI Kimco, BEI Sensors, BEI
PSSC, Crouzet, Crydom, Kavlico, Newall and Systron Donner
Inertial, CST offers a wide range of reliable and efficient
components dedicated to the Aerospace & Defense,
Transportation, Industrial, Medical and Energy & Infrastructure
markets. Through the expertise, diversity and agility of its
4,400 employees worldwide, CST is focused on the satisfaction of
its customers. Committed to excellence, with sales of $590M US in 2014,
CST is the dependable and adaptable partner for the most
demanding applications. For more information, please visit
CST's website at www.cstsensors.com.
Non-GAAP Measures
Adjusted net income and Adjusted EBITDA are non-GAAP financial
measures. The Company defines Adjusted net income as follows: Net
income before certain restructuring and special charges, costs
associated with financing and other transactions, deferred
loss/(gain) on other hedges, depreciation and amortization expense
related to the step-up in fair value of fixed and intangible assets
and inventory, deferred income tax and other tax expense,
amortization of deferred financing costs, and other costs. The
Company defines Adjusted EBITDA as follows: Net income before
provision for/(benefit from) income taxes and other tax related
expense, interest expense (net of interest income), amortization
and depreciation expense, deferred (gain)/loss on other hedges,
costs associated with financing and other transactions,
restructuring and special charges, and other costs. The Company
believes Adjusted net income and Adjusted EBITDA provide investors
with helpful information with respect to the Company's operating
performance, and management uses Adjusted net income and Adjusted
EBITDA to evaluate its ongoing operations and for internal planning
and forecasting purposes. Adjusted net income and Adjusted EBITDA
are not measures of liquidity.
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the federal securities laws. These statements
relate to analyses and other information, which are based on
forecasts of future results and estimates of amounts not yet
determinable, and the Company's future prospects, developments and
business. Such forward-looking statements include, among
other things, the Company's anticipated results for 2016 and future
periods. Such statements involve risks or uncertainties that
could cause actual results to differ materially from those
expressed in the forward-looking statements. Factors that
might cause these differences include, but are not limited to, the
failure to receive, on a timely basis or otherwise, the required
approvals from government and regulatory authorities in connection
with the transaction, the terms of those approvals, the risk that a
condition to closing contemplated by the share purchase agreement
may not be satisfied or waived, the inability to realize expected
synergies or cost savings or difficulties related to the
integration of CST, the ability to retain and hire key personnel
and maintain relationships with customers, suppliers or other
business partners of CST, risks associated with: adverse
developments in the industrial, aerospace or automotive industries;
competitive pressures that could require the Company to lower
prices or result in reduced demand for the Company's products;
integration of other acquired businesses, including Schrader; the
assumption of known and unknown liabilities in the acquisition of
CST; risks associated with the Company's non-US operations;
litigation and disputes involving the Company, including the extent
of intellectual property, product liability, and warranty claims
asserted against the Company; risks associated with the Company's
historical and future tax positions; risks related to labor
disruptions or costs; and risks associated with the Company's
substantial indebtedness. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak to
results only as of the date the statements were made; and the
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether to reflect any future events or
circumstances or otherwise. For a discussion of potential
risks and uncertainties, please refer to the risk factors listed in
the Company's SEC filings. Copies of the Company's filings
are available from its Investor Relations department or from the
SEC website, www.sec.gov.
Contact:
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Investors:
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News
Media:
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Jacob
Sayer
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Linda
Megathlin
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+1 (508)
236-3800
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+1 (508)
236-1761
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investors@sensata.com
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lmegathlin@sensata.com
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SOURCE Sensata Technologies B.V.