HEICO Corporation Acquires Niche Embedded Computing Company
August 19 2020 - 8:52AM
Business Wire
Purchase is HEICO’s 6th acquisition in this
fiscal year to date
HEICO Corporation (NYSE: HEI.A) (NYSE: HEI) today announced that
its Electronic Technologies Group acquired 89.99% of Connect Tech
Inc. (“CTI”) for cash at closing, plus potential additional cash
consideration to be paid if certain post-closing earnings levels
are attained. Further financial details were not disclosed.
HEICO expects the acquisition to be accretive to its earnings
within the first year following the closing. With this acquisition,
HEICO has completed six highly specialized, niche acquisitions in
its current fiscal year and four since the COVID-19 pandemic’s
start.
Connect Tech designs and manufactures rugged, small-form-factor
embedded computing solutions and offers both standard commercial
off-the-shelf products, as well as custom design services. CTI is
well-regarded for its computer-on-module carrier boards and GPU
solutions. CTI is NVIDIA’s largest global embedded hardware
partner, for which it is an NVIDIA® Jetson Elite Partner. CTI’s
components are designed for the harshest environments and are
primarily used in rugged commercial and industrial, aerospace and
defense, transportation, and smart energy applications.
Connect Tech will continue to operate and serve its customers
out of its 20,000-square-foot, fully-integrated design and
manufacturing facility in Guelph, Ontario. Connect Tech employs
approximately 65 team members, and HEICO stated that it does not
expect any staff turnover to result from the acquisition.
David Worthen, who co-founded Connect Tech in 1985, will remain
as Connect Tech’s President and will be HEICO’s partner in the
company, retaining the portion not acquired by HEICO. Mr. Worthen
commented, “HEICO’s resources will help to fuel continued product
development and growth while our current executive team will remain
intact to ensure a seamless transition for our global customer
base. Having gotten to know HEICO over the past four years, I felt
they are the ideal partner for us.”
Laurans A. Mendelson, HEICO’s Chairman and Chief Executive
Officer, along with Victor H. Mendelson, HEICO’s Co-President and
Chief Executive Officer of its Electronic Technologies Group,
jointly commented, “Connect Tech is known among its customers as
being completely devoted to those customers’ needs and has a
reputation for excellent engineering, quality and response times,
all characteristics which attracted us to the company. Dave Worthen
built and leads a special team and we are delighted to be partnered
with the industry’s best. ”
HEICO Corporation is engaged primarily in the design,
production, servicing and distribution of products and services to
certain niche segments of the aviation, defense, space, medical,
telecommunications and electronics industries through its
Hollywood, Florida-based Flight Support Group and its Miami,
Florida-based Electronic Technologies Group. HEICO's customers
include a majority of the world's airlines and overhaul shops, as
well as numerous defense and space contractors and military
agencies worldwide, in addition to medical, telecommunications and
electronics equipment manufacturers. For more information about
HEICO, please visit our website at http://www.heico.com.
Connect Tech Inc. is NVIDIA’s largest global embedded hardware
partner offering a wide array of NVIDIA® Jetson™ solutions, as well
as embedded solutions for a variety of industry standards including
COM Express, SMARC, and more. With over 35 years of embedded
computing experience, Connect Tech’s range of proven technology
includes complete embedded systems, carrier boards, thermal
solutions, and more. With in-house design and manufacturing
services, Connect Tech can provide fast turn-around of custom
design services, taking you from development to deployment in
record time. For more information visit www.connecttech.com.
Certain statements in this press release constitute
forward-looking statements, which are subject to risks,
uncertainties and contingencies. HEICO's actual results may differ
materially from those expressed in or implied by those
forward-looking statements as a result of factors including: the
severity, magnitude and duration of the COVID-19 outbreak; HEICO’s
liquidity and the amount and timing of cash generation; the
continued decline in commercial air travel caused by the COVID-19
outbreak, airline fleet changes or airline purchasing decisions,
which could cause lower demand for our goods and services; product
specification costs and requirements, which could cause an increase
to our costs to complete contracts; governmental and regulatory
demands, export policies and restrictions, reductions in defense,
space or homeland security spending by U.S. and/or foreign
customers or competition from existing and new competitors, which
could reduce our sales and profitability; our ability to introduce
new products and services at profitable pricing levels, which could
reduce our sales, sales growth or profitability; product
development or manufacturing difficulties, which could increase our
product development and manufacturing costs and delay sales; our
ability to make acquisitions and achieve operating synergies from
acquired businesses; customer credit risk; interest, foreign
currency exchange and income tax rates; economic conditions within
and outside of the aviation, defense, space, medical,
telecommunications and electronics industries, which could
negatively impact our costs and revenues; and defense spending or
budget cuts, which could reduce our defense-related revenue and
profitability. Parties reading this press release are encouraged to
review all of HEICO's filings with the Securities and Exchange
Commission, including, but not limited to filings on Form 10-K,
Form 10-Q and Form 8-K. We undertake no obligation to publicly
update or revise any forward-looking statement, whether as a result
of new information, future events or otherwise, except to the
extent required by applicable law.
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Victor H. Mendelson (305) 374-1745 ext. 7590 Carlos L. Macau,
Jr. (954) 987-4000 ext. 7570
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