Northlake designs, manufactures and distributes electromagnetic products and solutions used in the power distribution and medical equipment sectors. It has about 70 employees, all of whom will be retained at its Bristol location in the transaction. As of August, Northlake had about $10 million in revenue over the past year, according to a release from Standex.
“This is not a consolidation play,” said Thomas DeByle, chief financial officer at Standex. “If anything, we’ll grow that facility. It’s right in the beginning, but I anticipate putting more employees in that existing footprint.”
Standex, which has more than 5,000 employees worldwide, is a multi-industrial firm with five divisions: Food Service Equipment Group, Engineering Technologies Group, Engraving Group, Electronics Products Group and Hydraulics Products Group. The company expects the acquisition of Northlake to be accretive to fiscal 2017 earnings, to the tune of 4 to 6 cents per share.
Standex also has Wisconsin locations in Hudson, Belleville and New Berlin, and is currently building a second, 72,000-square-foot location in New Berlin. With the acquisition of Northlake, Standex will have 750 employees in Wisconsin.
Northlake will likely keep its branding under the Standex umbrella, DeByle said. It will be integrated with the Electronics division, which is based in Cincinnati. Economies of scale and similar product offerings make the acquisition a good fit, he said.
“Our electronics group deals in high reliability magnetics, and so does Northlake Engineering,” DeByle said. “So there’ll be sales synergies, there’ll be cross-selling opportunities, there’ll be cross-consolidation, more buying power.”
“Becoming part of Standex will enable us to achieve Northlake’s strategic growth objectives faster than we could on our own,” said William Hardt, president of Northlake. “We are excited about the opportunity to help Standex Electronics broaden its high-reliability magnetics business. Our intimacy and longstanding relationships with blue-chip customers in the power distribution and medical equipment industries make Northlake and Standex a great strategic fit. Operating as a combined organization will provide Northlake with critical mass and the opportunity to leverage new sales channels and products. This will enable us to operate more efficiently than we could as an independent company, while accelerating our growth.”
“Acquiring Northlake directly supports our Electronics Group strategy of expanding our high reliability magnetics business into adjacent markets to drive growth and profitability,” said David Dunbar, chief executive officer of Standex. “Northlake is highly regarded for the performance and quality of its products, which complement our Standex Electronics offerings and position us to provide a wider array of solutions to customers in the power generation and medical equipment markets. In addition, Northlake brings us an experienced management team, and I welcome the opportunity to benefit from their expertise.”
“We welcome the entire Northlake team to Standex Electronics and look forward to working together to successfully expand our product portfolio and customer base,” said John Meeks, president of Standex Electronics. “During its 60-plus years in business, Northlake has built a solid organization with a strong brand reputation in power distribution, medical equipment and other high-reliability magnetics markets. Acquiring Northlake also creates the potential for both revenue and cost synergies related to cross selling and procurement savings as we leverage Standex’s broader global supply chain and operational excellence practices to support Northlake’s product sales and operations.”