TORONTO – Manufacturing services company SMTC Corp. (TSX:SMX) will spend $10.6 million to acquire and integrate ZF Array Technology Corp., which makes complex electronics equipment and provides systems integration services.
SMTC will pay up to $9.1 million to acquire ZF’s shares, including $2.4 million that can be earned during a two-year performance period, the Toronto-based company announced Thursday.
SMTC also anticipates $1.5 million in one-time integration costs to integrate the two companies’ nearby plants in San Jose, Calif.
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ZF, which also has operations in China, provides services to telecommunication, wireless and life-science equipment manufacturers.
“The acquisition of ZF’s operations in California will significantly strengthen SMTC’s market offering, providing our customers with expanded capability in complex radio frequency engineering and systems integration services,” SMTC co-CEO Claude Germain said in a statement.
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SMTC shares gained four cents to trade at $1.45 on the Toronto Stock Exchange.
“The design, engineering, and technical depth of these operations will significantly bolster and differentiate SMTC in San Jose.”
ZF chief executive Bob Zinn, who is also majority owner, will continue in an advisor. ZF’s senior management team and employees of ZF will join SMTC.
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