Performance materials company Ferro Corp. of Mayfield Heights, Ohio, said it bought Electro-Science Laboratories Inc., a maker of electronic packaging materials, for $75 million.
The acquisition of King of Prussia, Pa.-based Electro-Science "enhances Ferro's position in the electronic packaging materials space with complementary products, and offers an attractive platform for growth in Ferro's Performance Colors and Glass business unit," the company said in a news release.
Electro-Science produces thick-film pastes and ceramic tape systems "that enable important functionality in a wide variety of industrial and consumer applications," Ferro said. Its key products are used to build hybrid integrated circuits, modules and sensors that function in harsh conditions.
The Pennsylvania company was founded in 1962 and has remained privately owned and associated with its founding family since then. Electro-Science has 86 employees and operations in the United States and United Kingdom.
Full-year 2016 adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) for Electro-Science is expected to be $9.2 million. Ferro said in the release that it expects cost savings in the deal of "in excess of $10 million, with $6 million realized within the first three years of operation." The transaction should be accretive to earnings in the first year, Ferro said.
Peter Thomas, chairman, president and CEO of Ferro, said the Electro-Science deal is the fifth by Ferro in 2016. It's the first significant acquisition in the company's Performance Color and Glass segment, Ferro said, "and we are actively reviewing other opportunities in this space."
Other Ferro units have been making acquisitions, however, including the pigments, which announced Oct. 17, it had entered into an agreement to buy Cappelle Pigments NV, and said it has acquired certain assets of Delta Performance Products.