Itron, Inc. has signed an agreement to acquire all of the stock and convertible bonds of Actaris Metering Systems. The purchase price is €800 million plus the retirement of approximately €445 million of debt, which, at an exchange rate of 1.30, totals approximately $1.6 billion. The acquisition is expected to close in the second quarter of 2007.
Actaris offers electricity, gas and water metering, primarily outside of North America. Itron provides AMR solutions in North America. The combined company will be one of the largest metering companies in the world. This acquisition will allow Actaris to offer Itron’s AMR and advanced metering infrastructure (AMI) technologies, software and systems expertise to customers outside of North America, and expand Actaris gas and water meter opportunities in North America.
For the 12 months ended Dec. 31, 2006, Actaris generated revenue of approximately $1 billion and adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) of approximately $159 million.
“This acquisition, which will more than double Itron’s annual revenues, brings together two industry leaders and reunites two former Schlumberger divisions,” said LeRoy Nosbaum, chairman and CEO.
The acquisition of Actaris will be funded by approximately $1.1 billion of fully committed senior secured debt facilities, the net proceeds of the private placement of approximately $235 million of common stock, which was completed February 25, 2007, and cash on hand.
Based on management’s expectation for closing in the second quarter, Itron expects that in 2007 the acquisition will add approximately $720 - $730 million in revenue, $0.20 - $0.30 in non-GAAP EPS and $110 - $115 million Adjusted EBITDA. These estimates are subject to financing terms and dependent on the closing date of the transaction and do not take into effect any intangible amortization expenses, in-process research and development expenses, charges related to inventory revaluation required under purchase accounting or other acquisition expenses.
