ST. LOUIS -- Viasystems Group has agreed to buy DDi Corp. for $268 million in cash, a deal that will vault the printed circuit board company into the Top 10 in the industry.

Both companies' boards have approved the deal, which is due to close either this quarter or early in the third quarter. The combined company will have more than $1.3 billion in revenue and 15,650 workers.

Under terms of the deal, Viasystems will pay $13 per share for Anaheim, CA-based DDi. Viasystems expects the transaction to be immediately accretive to adjusted EPS, even without the impact of anticipated cost synergies, expected to be at least $10 million annually before taxes, and realizable within six months after closing.

The companies said that the transaction's total value is about $282 million when including assumed debt.

Based on results for the 12 months ended Dec. 31, the combined operation would have had pro forma revenue of $1.32 billion and, excluding cost synergies, pro forma adjusted EBITDA of $183 million.

Combined, the companies have more than 4.3 million sq. ft. of manufacturing floor space in China and 1 million sq. ft. in North America. The transaction also teams one of the world's largest high-volume fabricators with one of the leaders in quickturn boards. Neither company indicated whether any factories would be closed as result of the deal.

Viasystems' last big acquisition came just over two years ago when it acquired Merix. Viasystems, which was ranked as the 16th largest PCB fabricator in the 2010 NTI-100, would now be close to sixth or seventh. It remains the second-largest US-based fabricator, behind TTM Technologies.

In a statement, Viasystems chief executive David Sindelar said, “This transaction combines two market leaders and strengthens Viasystems’ position as a world-class leader in PCB and related electro-mechanical solutions by expanding our technology and manufacturing capabilities, diversifying our end markets and broadening our customer base and product portfolio. Ultimately, this transaction creates a larger platform which Viasystems can better leverage to serve our customers and to generate attractive returns for our shareholders. Further, the addition of DDi strengthens Viasystems’ financial model and enables us to achieve even higher levels of profitability and cash generation.”

DDi closed 2011 with net revenue of $263.4 million, pretax earnings of $23.4 million and net profits of $21.9 million. The company had $8.6 million in long-term debt as of Dec. 31. Based on EBITDA, Viasystems will pay 10 times last year's numbers for DDi.

Ed.: Read Mike Buetow's comments on the deal here.

• Prev
• Next