Wireless Telecom Group (WTG) will acquire Holzworth Instrumentation, a manufacturer of ultra-low noise phase noise analyzers and signal generators based in Boulder, Colorado. Holzworth complements WTG’s test and measurement segment.

WTG will pay $8 million in cash at closing, $500,000 in WTG common stock and $1.5 million in a deferred cash payment based on EBITDA performance. WTG requires debt financing to cover the $8 million cash payment, which it is seeking. WTG said the acquisition will close “in the months ahead.”

Timothy Whelan, CEO of WTG, said the two companies have common customers and channel partners. Holzworth’s products “meet demanding performance specifications in a unique form factor at an attractive price point, allowing them to compete with some of the largest test and measurement equipment manufacturers worldwide,” he said. “This acquisition is expected to drive future growth and accretive profitability to our test and measurement segment by the attractive margins of the business.”

Jason Breitbarth, president of Holzworth, said, “With a larger sales channel footprint, broader customer base and a global team of RF and microwave experts, we expect to deliver even greater value to shared and new customers. We believe this combination will allow us to realize greater growth as we focus our principal skill sets on technology advancement and business development.”

WTG announced the deal Thursday, 14 November, timed with WTG’s earnings release for the third quarter (Q3), which ended September 30.

WTG reported Q3 revenue of $10.8 million, down 23 percent from the same quarter in 2018, when revenue was $14.0 million. All segments had lower revenue, with test and measurement down 18.7 percent year-over-year, due to lower shipment to government customers. The test and measurement segment contributed 28 percent of WTG’s total revenue. Overall, WTG had a net loss of $461,000, or ($0.02) per basic and diluted share for the quarter.