- Impakt’s specialized, multi-industry capital equipment capabilities will provide customers with large-format, high-mix manufacturing solutions
- The acquisition will expand Celestica’s capabilities in key U.S. and Korean markets
- The acquisition will enhance Celestica’s industry-leading position in capital equipment manufacturing
TORONTO, Canada — Celestica, Inc. (NYSE, TSX: CLS), a leader in design, manufacturing and supply chain solutions for the world’s most innovative companies, today announced that it has entered into a definitive agreement to acquire Impakt Holdings, LLC.
Impakt is a highly-specialized, vertically integrated manufacturer providing manufacturing solutions for leading OEMs in the semiconductor and Organic Light Emitting Diode (OLED) display industries, as well as other markets requiring complex fabrication services. Founded in 1977, the company is headquartered in Santa Clara, with operations in California and South Korea.
Through this acquisition, Celestica expects to gain significant, new capabilities in large-format, complex, high-mix manufacturing solutions for multiple industries, and broaden its precision component manufacturing, full system assembly, integration and machining capabilities. In addition, Celestica anticipates that it will benefit from Impakt’s full spectrum of specialized vertical services including its South Korea-based machining and manufacturing expertise. In conjunction with Celestica’s current capital equipment business, Impakt’s vertical integration will enable Celestica to provide more efficient end-to-end product lifecycle solutions across a diverse set of markets.
“The acquisition of Impakt will enhance Celestica’s position as the largest end-to-end capital equipment manufacturer in our industry,” said Rob Mionis, President and CEO, Celestica. “Through Impakt’s extensive capabilities, we will be able to provide customers with even deeper and broader capital equipment manufacturing services including in-region and vertical offerings. Impakt will also expand Celestica’s second largest end market within our growing $2.2 billion ATS segment, and is well aligned to our company strategy of expanding and diversifying our overall revenue and margin mix through targeted investments and acquisitions.”
“Impakt’s deep expertise in its core markets will fit well with Celestica and its leading position in capital equipment manufacturing,” said Dan Rubin, CEO of Impakt. “Together, Impakt and Celestica have the opportunity to create compelling end-to-end solutions for our customers across multiple markets and in key geographies.”
Celestica will purchase Impakt for US$329 million, and the transaction is expected to be accretive to consolidated non-IFRS operating margin* and overall ATS margin upon closing. We intend to finance the purchase price, which is subject to specific adjustments set forth in the definitive agreement, with a combination of borrowings under the company’s current credit facility. The acquisition is expected to close in the fourth quarter of 2018, subject to receipt of applicable regulatory approvals and satisfaction of other customary closing conditions.
* See Non-IFRS Measures below.
Moelis & Company LLC acted as exclusive financial advisor to Celestica, and Blake, Cassels & Graydon and Arnold & Porter as its legal counsel. Stifel and Lincoln International acted as financial advisors to Impakt.
Management to host a conference call
Management will host a brief conference call today at 8:00 a.m. Eastern Daylight Time to discuss the acquisition. The webcast can be accessed by phone at (877) 291-4570. A webcast for the announcement will be available at https://corporate.celestica.com/events-and-presentations at approximately 8:00 a.m.
Celestica enables the world’s best brands. Through our recognized customer-centric approach, we partner with leading companies in aerospace and defense, communications, enterprise, healthtech, industrial, semiconductor capital equipment, and smart energy to deliver solutions for their most complex challenges. A leader in design, manufacturing, hardware platform and supply chain solutions, Celestica brings global expertise and insight at every stage of product development – from the drawing board to full-scale production and after-market services. With talented teams across North America, Europe, and Asia, we imagine, develop and deliver a better future with our customers.
Impakt Holdings LLC, is a privately held global vertically integrated contract manufacturer. Impakt provides design, engineering and agile manufacturing solutions for the display, semiconductor, solar and other capital equipment industries as well as specialized services that require large format, high-mix complex manufacturing, and integration solutions.