- Buyers Guide
Ducommun Inc. announced that it has entered into a definitive agreement to acquire all outstanding stock of LaBarge Inc.. LaBarge, with revenue of $324 M for the twelve months ended January 2, 2011, is a widely recognized supplier of electronics manufacturing services (EMS) operating across many high-growth industries. The acquisition will nearly double Ducommun’s revenue base, improve the company’s position as a Tier 2 leader in both aerostructures and electronics, and bring access to new customers and markets.
Pursuant to the terms of the definitive agreement, Ducommun will acquire all issued and outstanding shares of LaBarge at $19.25 per share in cash for a total purchase price of approximately $340 M, including the assumption of LaBarge’s outstanding debt ($30 M as of January 2, 2011). The closing of the transaction is subject to the approval of LaBarge shareholders and certain other customary conditions, including expiration of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Once completed, LaBarge will be combined with the company’s Ducommun Technologies (DTI) subsidiary and renamed Ducommun LaBarge Technologies, under the leadership of LaBarge’s current chief operating officer, Randy Buschling. Based on management’s assumptions, the transaction is expected to be accretive to Ducommun’s earnings in the full year 2012.
“This is one of the most strategically significant moves Ducommun has ever made, one which will transform our company into a larger, stronger entity focused on serving our customers in aerostructures and electronics,” said Anthony J. Reardon, President and Chief Executive Officer of Ducommun. “LaBarge is a leading supplier of critical electronics systems and subsystems for the aerospace and defense, industrial, energy and medical markets, with a compatible corporate culture, excellent management team, and outstanding workforce. Noted for having deep, long-term relationships with its customers, LaBarge also provides high-end engineering and design support, prototyping, program management and testing.
“The acquisition solidifies Ducommun as a premier Tier 2 provider of both structural and electronic assemblies. By adding LaBarge to Ducommun Technologies, we will form one of the largest global aerospace and defense providers of EMS for high margin, low volume/high mix applications. We look forward to this next, exciting stage of our development.”