MANHASSET, N.Y. Power supplier Power-One Inc. has signed a definitive agreement to acquire the Power Electronics Group of Magnetek Inc., for $71.7 million in cash.
Under the deal, Power-One (Camarillo, Calif.) will also assume $16.7 million in debt. The company has obtained financing for the acquisition, expected to close in October.
Magnetek's Power Electronics Group sells power supplies and alternative energy products to various customers and markets. The group has operations in Italy, Hungary, China and the United States, with 500,000 sq. ft. of manufacturing space and 1,200 employees. Major customers include Alcatel, Electrolux, Google, IBM, Indesit, Motorola, and Siemens.
Power-One expects combined 2007 sales from both companies to range from $530 million to $550 million, with the acquisition to be accretive to earnings beginning next year.
Steve Goldman, chairman of Power-One, said in a statement, "The Power Electronics Group has been an excellent contributor to Magnetek and its addition will augment Power-One in a number of ways, including adding low-cost manufacturing capability in China, custom design resources in Europe, and entry into the alternative energy market. Overall, we anticipate that the acquisition will favorably impact our financial performance increasingly throughout 2007 and 2008 as synergies are realized."
The China plant Power-One acquires through the deal measures 230,000 square feet and will give the company a stronger presence in the growing Chinese market, according to the company.