Germany’s Jenoptik AG has agreed to acquire Prodomax Automation Ltd, a Barrie, Ontario-based specialized engineering company that designs and builds flexible automation systems for the automotive industry.
Terms weren’t disclosed for the deal, which is expected to close in the next few weeks.
Established in 1971, Prodomax is led by Co-CEOs Don Leslie and Carolyn Garvey. Jenoptik, an operating technology group, said the acquisition will help it tap into new opportunities in advanced manufacturing.
The private equity group of Kensington Capital Partners acquired Prodomax in 2015, partnering with management to support growth and facilitate an ownership transition. BDC Capital‘s growth equity group invested in the same year.
Jenoptik announces acquisition of Prodomax Automation Ltd. and raises its 2018 revenue guidance
10 July 2018
The Canadian company focuses on machine integration and process automation in the automotive industry.
The combination of automation solutions and laser processing machines enables Jenoptik to tap into additional growth potential in advanced manufacturing.
Following the acquisition and due to the continuing good demand in some markets the Jenoptik Group now expects revenue of between 805 to 820 million euros in 2018 (previously: 790 to 810 million euros).
Jenoptik has entered into an agreement to acquire 100 percent of the Canadian company Prodomax Automation Ltd. for a consideration of slightly below 2x expected sales, or around 7x expected 2018 EBITDA. The contract has been signed today, closing is expected within the next few weeks.
Prodomax, founded in 1971 and headquartered in Barrie, Ontario, Canada, employs about 180 staff and is specialized in process automation for the automotive industry. With the acquisition Jenoptik strengthens its position as a full-service turnkey provider of complex automated manufacturing solutions the company has embarked on with the acquisition of Five Lakes Automation (FLA) in 2017. Like FLA, Prodomax will become a part of the Group’s global laser processing business.
Similar to FLA, Prodomax plans and designs automated production lines as well as integrates them in the customer’s manufacturing environment. The services and products around process engineering and implementation include system layout, simulation, hardware controls and software design, robotic handling systems as well as transfer devices. Whilst FLA focusses on small and medium-sized contract business, Prodomax has the capacities and the strong customer basis to pursue larger projects.
Due to the acquisition Jenoptik will be able to tap into new areas of application for its 3D laser machines in future. “With the acquisition of Prodomax and our expertise in laser material processing we take a huge step towards becoming an integrated provider of advanced manufacturing environment”, says Stefan Traeger, President & CEO of JENOPTIK AG.
Prodomax and FLA will not only benefit from Jenoptik’s extensive expertise in efficient, precise and safe 3D laser processing, a technology that becomes ever more important in automated manufacturing environments, but also from the Group’s financial strength and its global reach.
In addition, Prodomax benefits from the strong US presence of the Jenoptik Group: “In combination with FLA’s automation solutions and the laser processing business we can evolve into a global production integrator. Together with Jenoptik, we will be able to win new customers, extend our know-how to other production steps in the manufacture of, for example, doors or tailgates, and to gradually transfer our competencies to other industries”, say Don Leslie and Carolyn Garvey, Co-CEOs of Prodomax.
Prodomax, has a history of strong growth and excellent operating efficiency. In its fiscal year 2017 (Nov. 1, 2016 – Oct. 31, 2017) the company’s revenue was some 65 million Canadian Dollar (approx. 42 million euros) with a profitability clearly above Jenoptik’s Group average. Jenoptik will consolidate future revenues and earnings, including effects from purchase price allocation, pro-rata in 2018.
“With the acquisition of Prodomax announced today and a continuing good demand in the Groups’ business overall, we now see 2018 revenue of Jenoptik to exceed our current guidance for the year. Including the consolidation of the new Canadian company pro-rata for the rest of the year, we expect group revenue to be between 805 and 820 million euros in 2018 against our original guidance range of 790 and 810 million euros”, explains Stefan Traeger. Further details regarding the financial impact of the acquisition will be discussed with the reporting of our H1 results on August 9, 2018.
Jenoptik is represented in North America with about 330 employees at eight sites. In Rochester Hills, Michigan, more than 110 employees work for the North American automotive industry with state-of-the-art industrial metrology, laser processing machines and automation solutions. In the fiscal year 2017, the Jenoptik Group recorded revenue growth of more than 28 percent in the Americas with a total revenue of 173.6 million euros.
As globally operating technology group, Jenoptik is active in the three segments Optics & Life Science, Mobility and Defense & Civil Systems. Optical technologies are the very basis of our business with the majority of our products and services being provided to the photonics market. Our key target markets primarily include the semiconductor equipment industry, the medical technology, automotive and mechanical engineering, traffic, aviation as well as the security and defense technology industries. Jenoptik has about 3,700 employees and generated revenue of approx. 748 million euros in 2017.
More information on Prodomax Automation Ltd. can be found online on the corporate website http://www.prodomax.com.
Head of Corporate Communications and Marketing
+49 3641 65-4455/+49 3641 65-2484