It's been a big year for acquisitions of companies involved in robotics and automation: 48 have sold thus far in 2016. Eight involved amounts over $500 million and five were over a billion; KUKA's acquisition by Chinese consumer products giant Midea was the biggest at $5.11 billion.
The most recent is Teledyne Technologies, which specializes in deepwater gas and oil exploration and production, oceanographic research, air and water quality environmental monitoring, electronics design and development, factory automation and medical imaging, in an all cash $780 million transaction, to acquire British imaging sensor maker E2V Technologies. Teledyne's offer represents a 48% premium on last weeks E2V's closing price.
E2V's imaging devices, machine vision cameras for sensitive, high speed inspection processes, industrial processing systems, and other sensors, enable a range of industrial robotic and automation systems to work more efficiently and for space science and astronomy applications. E2V also provides high reliability semiconductors and board-level solutions for use in aerospace, space and radio frequency communications applications. For the year ended March 31, 2016, E2V had sales of approximately $300 million.
“We have followed e2v for more than a decade. Over time, as both Teledyne and e2v evolved, our businesses have become increasingly aligned. In fact, every business within e2v is highly complementary to Teledyne. As important, there is minimal product overlap,” said Robert Mehrabian, Chairman, President and Chief Executive Officer of Teledyne. “For example, we are both leaders in space and astronomy imaging, but Teledyne largely provides infrared detectors and e2v provides visible light sensors.
“In machine vision applications, e2v’s advanced capabilities in proprietary CMOS sensor design add to Teledyne’s strengths in cameras and vision systems. While Teledyne designs advanced mixed signal circuits for government and commercial applications, e2v’s broader product portfolio enhances our offerings and channels to market.”
Both Teledyne and E2V are members of the ROBO Global Robotics & Automation UCITS Index, an index of 82 stocks from around the world that reflect the robotics and automation industry (and of which I am a co-founder). ARCAM, Swisslog, Kuka, Mako, Zygo and Atmel were other publicly-traded stocks which also got acquired in 2016 and recent years.
Of the 48 acquisitions thus far in 2016, only 30 disclosed the amounts involved. However those 30 transactions totaled an astounding $17,500,000,000!
One CEO of a selling company, Enrico Krog Iversen, who sold Danish Universal Robots to American Teradyne in 2015, when asked if it was a trend that robotics-related companies were exiting to larger companies or funds instead of going public, said:
Exiting to a larger company will often make sense not only for financial reasons, but also for people reasons – opening up for new/more career opportunities. You will become part of something bigger and can instantly get access to additional resources. Naturally there are also some political considerations if you choose this path.
Exiting to a fund is also a good financial solution and you will probably get access to a very strong board who can help you develop the company faster.
An IPO may bring more money on paper, but it is a very restricted way to exit and it is also very bureaucratic to run a listed company. In our case, I preferred to have a good sum of money in the bank instead of a lot of money on paper. Also I did not personally fancy all the bureaucracy and politics that goes with being CEO of a listed company.
The Robot Report's annual recap of fundings, acquisitions and IPOs wil appear just after the new year. Stay tuned.