RICHMOND, UK – Cable assembly maker Volex has acquired EMS firm Servatron for up to $28.5 million in cash and shares, including assumption of $6.7 million in net debt.
The acquisition is expected to be completed Wednesday.
In 2018, Servatron generated pretax profit of $2.5 million on revenue of $35.6 million. Over the first six months of 2019, the firm reported $2 million in pretax profit from $23.1 million in revenue. For the financial year ended March, Volex generated $11.6 million pretax profit from revenue of $372.1 million.
"It is an extremely high-quality and well-managed business, which will now be able to access our unique global footprint," said Nat Rothschild, executive chair, Volex. "Our own world-class cable assemblies division gets a diverse range of interconnect products and integrated solutions to offer our existing accounts. This is a win-win deal."
Rothschild reported revenue grew 12% on the year prior on a reported basis and was up 14% at constant currency. Operating profit margins were "ahead of current expectations.
"Our global footprint allows us to mitigate the effect of US tariffs on Chinese manufactured goods, as we move production of certain products from China to other locations such as Vietnam and Indonesia."