Greatbatch
's (
GB
) Electrochem division, which makes high performance commercial
batteries, has wrapped up its recently announced acquisition of
Oregon-based battery supplier Micro Power Electronics for roughly
$60 million in cash.
Greatbatch funded the acquisition with available cash and $45
million in a revolving credit facility. In addition to the
purchase consideration, Electrochem also assumed debt and incurred
specific acquisition-related payments and expenses.
Micro Power supplies custom battery solutions to the portable
medical, military and automatic identification and data collection
markets. Its product portfolio complements Electrochem's offerings
for the portable medical, energy, military and environmental
industries.
The acquisition will diversify Electrochem's revenues by
broadening its foothold in the portable medical battery market and
stimulating growth in other key areas. Electrochem plans to retain
Micro Power's Oregon facility ,which employs roughly 200
people.
Micro Power is expected to generate roughly $70 million in sales
in 2011. The acquisition is expected to be neutral to Greatbatch's
earnings (barring one-time acquisition related charges) in 2011 and
2012 and accretive thereafter.
Greatbatch is a leading producer and supplier of batteries,
capacitors and components used in implantable medical devices. The
company's top customers include
Boston Scientific
(
BSX
),
Johnson & Johnson
(
JNJ
),
Medtronic
(
MDT
) and
St. Jude
(
STJ
).
Greatbatch has been acquiring complementary businesses over the
last few years to boost sales. The company's pipeline is healthy
with a number of products currently under development that are
expected to support growth in the long run. Our Outperform
recommendation on the stock is supported by a Zacks #2 Rank, which
translates into a short-term Buy recommendation.
BOSTON SCIENTIF (
BSX
): Free Stock Analysis Report
GREATBATCH INC (
GB
): Free Stock Analysis Report
JOHNSON & JOHNS (
JNJ
): Free Stock Analysis Report
MEDTRONIC (
MDT
): Free Stock Analysis Report
ST JUDE MEDICAL (
STJ
): Free Stock Analysis Report
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