ATS to acquire M+W Process Automation

Source: ATS Automation Tooling Systems Inc.

Jul 10, 2014

ATS Automation Tooling Systems Inc. has entered into a definitive agreement to acquire all shares of M+W Process Automation GmbH and ProFocus LLC, collectively M+W PA, a leading global provider of engineering-based automation services and solutions focused on the control, performance monitoring and measurement of critical production processes.

Headquartered in Germany and established 28 years ago, M+W PA addresses the needs of a wide spectrum of manufacturing and process-based industries including automotive, pharmaceutical, biotechnology, chemicals, oil & gas and food with services that include consulting, system engineering, integration, lifecycle management, process control and manufacturing execution systems, as well as enterprise programs, where M+W PA acts as the main automation contractor ("MAC").

The acquisition is aligned with ATS's stated strategy of scaling its position in the global automation market by adding to its services and life-cycle management capabilities across several core elements of the customer value chain. The addition of M+W PA is expected to enhance growth opportunities in both new markets and with existing customers.

In calendar 2013, M+W PA had revenues of approximately €166 million and Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") of approximately €20 million. M+W PA's order bookings were €188 million, and at the end of May 2014 it had approximately €120 million of backlog.

Subsequent to the completion of the transaction, the Company expects M+W PA to benefit from the adoption of ATS best practices in approach to market, key account management, front-end-of-the-business processes, performance management and corporate strategy. M+W PA's significant capability and market position is expected to benefit ATS and its strategy to grow its business. The Company expects meaningful revenue synergies through an expanded ATS offering, which will now include M+W PA's process controls, software integration, MES, remote monitoring, lifecycle management, modeling and simulation capabilities.

The purchase price based on enterprise value of approximately €248 million (CDN $362 million at current exchange rates) is subject to net debt and working capital adjustments.