Digital signal processing (DSP) technologies specialist Lyrtech Inc., Quebec, has signed a letter of intent to acquire the business assets of electronic manufacturing services (EMS) provider Innovator Electronic Assembly, Pointe-Claire QC, for $5.4-million.
“This is a very significant development for Lyrtech,” Lyrtech President and CEO Migüel Caron says.
According to Lyrtech, non-audited internal Innovator financial statements, adjusted to reflect Lyrtech accounting standards, indicate that for the financial year ended on January 31, Innovator generated revenues of $14-million, EBITDA of $1.5-million and net income of $300,000.
The statements show total assets of $6.5-million, total liabilities of $5.2-million and shareholders equity of $1.3-million.
Innovator grew revenues by more than 40% in each of the past 3 years, Lyrtech says.
“As a manufacturer of very complex circuit boards, many of which incorporate DSP technology, there is a high level of complementarity with Lyrtech’s business of providing advanced DSP engineering and new product turnkey solutions,” Caron says. “Furthermore, the concurrent financing of a minimum of $15.5 million in equity and debt provides Lyrtech with the financial resources and flexibility to grow its business going forward.”
Innovator Co-founder, President and COO Brian Mink will join Lyrtech’s executive management team as president of Innovator and assume responsibility for all of Lyrtech’s electronic manufacturing activities.
Along with the acquisition, Lyrtech plans a brokered private placement financing of up to $6.5-million through Dundee Securities.
“This acquisition combines two high growth companies that serve a similar client base with different yet complementary product and service offerings,” Caron says. “Following the acquisition, Lyrtech will be able to offer its clients advanced DSP engineering solutions coupled with a state of the art electronics manufacturing capability.”
