Hexatronic signs agreement to acquire U.S.-based Rochester Cable
from TE Connectivity
Press release October 3, 2022Gothenburg Sweden
Hexatronic signs agreement to
acquire
U.S.-based
Rochester Cable from TE
Connectivity
Hexatronic Group AB (publ) (“Hexatronic”) has signed a binding
asset purchase agreement to acquire all business activities of
Rochester Cable (“Rochester Cable”), one of the main designers and
manufacturers of harsh environment electro-optical cables in the
USA, from TE Connectivity (TE), a world leader in connectors and
sensors, for an enterprise value of USD 55 million.
Rochester Cable
Rochester Cable is a recognized leader in the design and
manufacture of electro-optical cables for operation in harsh
environments. The cables are highly engineered to meet specific
requirements in demanding industries such as oil and gas, sensing,
defense, oceanographic, and subsea applications.
Rochester Cable is powered by 130 employees today in Culpeper,
Virginia. In the 40,000 square meters production site, Rochester
Cable manufactures armored electro-optical working cables that
provide strength and transmit power, control signals, and data.
The agreement broadens Hexatronic’s offering within fiber optic
submarine communication cables to include dynamic working cables
that can transmit electrical signals and power in addition to
transmitting optical signals. The electro-optical cables can
accommodate extreme water depths to 6,000 meters and connect a
variety of sensors, equipment, and remotely operated vehicles.
Rochester Cable is a high-quality producer. Over the last
decade, TE has significantly invested in increasing capacity, and
the production facility provides many possibilities for further
growth.
The acquired business includes the land and buildings of the
production sites and office buildings. Product sales are mainly in
the U.S. but also in the EMEA and APAC regions.
Purchase price and financing
In the broken fiscal year, October 2021 to September 2022,
Rochester Cable is expected to generate a proforma stand-alone
EBITDA of approximately USD 8 million, representing a proforma
transaction multiple of approximately 7x EBITDA. The acquisition is
immediately accretive to earnings, adding an estimated 0.18 SEK per
Hexatronic share in the first full year after close.
The purchase price of USD 55 million is to be paid in cash at
closing, fully financed with senior debt. Second quarter pro forma
Net Debt-to-EBITDA ratio for the Hexatronic Group, including
Rochester Cable and previously announced transactions, is expected
to be about 2.0.
Completion of the transaction is subject to regulatory approvals
and is expected no later than March 31, 2023.
Comments from the CEO
“We are happy to have reached an agreement with TE Connectivity
to acquire the business activities of Rochester Cable. Rochester
Cable is uniquely positioned with its know-how and application
expertise, which has been developed as a market leader for decades.
The highly skilled team has developed a truly differentiated
offering and long-term partnerships with its customers. Hexatronic
has been a supplier of fiber optic submarine communication cables
since the 1990s. Combining the know-how, geographical footprint,
and product portfolio of Rochester Cable in the U.S. and Hexatronic
submarine business in Sweden provides exciting opportunities for
the future,” says Henrik Larsson Lyon, CEO of Hexatronic Group.
About TE Connectivity
TE Connectivity is a global industrial technology leader
creating a safer, sustainable, productive, and connected future.
Our broad range of connectivity and sensor solutions, proven in the
harshest environments, enable advancements in transportation,
industrial applications, medical technology, energy, data
communications, and the home. With more than 85,000 employees,
including over 8,000 engineers, working alongside customers in
approximately 140 countries, TE ensures that EVERY CONNECTION
COUNTS. Learn more at www.te.com and on LinkedIn, Facebook, WeChat
and Twitter.
Gothenburg, October 3, 2022
Henrik Larsson LyonCEO Hexatronic Group
For more information, please
contact:Henrik Larsson Lyon, CEO
Hexatronic Group, +46 706 50 34 00Pernilla Lindén, CFO
Hexatronic Group, +46 708 77 58 32
This is information that Hexatronic Group AB (publ) is obliged
to make public pursuant to the EU Market Abuse Regulation. The
information was submitted for publication, through the agency of
the contact person set out above, at 14:30 CEST on October 3, 2022.
This is a translation of the Swedish version of the press release.
When in doubt, the Swedish wording prevails.
Hexatronic creates sustainable networks all over the world. We
partner with customers on four continents – from telecom operators
to network owners – and offer leading, high-quality fiber
technology for every conceivable application. Hexatronic Group
(publ.) was founded in Sweden in 1993 and the Group is listed on
Nasdaq OMX Stockholm. Our global brands include Viper, Stingray,
Raptor, InOne, and Wistom®.
- 2022-10-03 Hexatronic signs agreement to acquire U.S.-based
Rochester Cable from TE Connectivity
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