FARMINGDALE, NY -- Cemtrex today reiterated its belief its management could unlock value for shareholders of EMS competitor Key Tronic.

"Cemtrex believes that a combination of the two companies will unlock significant shareholder value for both companies, by enabling cost savings, higher earnings per share and a more attractive price to earnings ratio than either company is currently maintaining," Cemtrex said in a press release.

The announcement comes a week after Cemtrex made an unsolicited bid for Key Tronic, offering a one-to-one exchange of shares. Under terms of the offer, which were presented in a press release but not a formal offer sheet, Key Tronic would become a subsidiary of Cemtrex. 

The Sept. 5 announcement took many observers by surprise, as Key Tronic is considerably larger than Cemtrex. For its fiscal year ended Aug. 1, Key Tronic reported total revenue was $467.8 million, versus $124.5 million for Cemtrex for the four quarters ended Jul. 1. Moreover, Key Tronic's market capitalization is $73.2 million while that of Cemtrex is $32.4 million.

Cemtrex acknowledged the difference in market capitalization, but claimed today its offer on a "fundamental valuation basis" is of "significant value" beyond the respective stock prices. Cemtrex asserted its financials are stronger than Key Tronic, including revenue growth and profitability, are superior.

Key Tronic has not yet responded to the latest comments.

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