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© rawpixelimages dreamstime.com Electronics Production | January 27, 2015

Sparton acquires KEP Marine

Sparton Corporation's subsidiary, Sparton IED, has completed the acquisition of KEP Marine, a USD 3 million revenue business, from Kessler-Ellis Products, Inc.
KEP Marine designs and manufactures industrial displays, industrial computers and HMI software for the Marine market. These product lines will be consolidated into the Aydin Displays facility, located in Birdsboro, Pennsylvania.

"The addition of KEP Marine meets the criteria of our growth strategy by growing our ruggedized electronics platform with additional ruggedized display and industrial computers in the harsh and demanding marine market sector, diversifying our customer base and increasing utilization of our existing assets,” stated Cary B. Wood, president and chief executive officer of Sparton. “Additionally, KEP Marine brings solid, long term customer relationships that will benefit from Sparton’s expanded list of service offerings.”

“We are pleased to add KEP Marine into Aydin Displays, allowing us to further enhance our market position in the Marine market,” commented Art Mengel, general manager of Aydin Displays. “In the coming months we will be transitioning KEP’s customers to Birdsboro with an orderly and seamless approach, using contemporary tools such as Sparton’s New Product Introduction (NPI) and Advanced Product Quality Planning (APQP) processes.”

“This tuck-in acquisition is a great example of our strategy to maximize existing assets while expanding our ruggedized electronics product platform. Since there will not be an addition of significant fixed overhead in Birdsboro related to this transaction, we expect KEP Marine’s revenue to enhance the Company’s Manufacturing & Design Services segment EBITDA. Coupled with the IED acquisition in December, we expect that Aydin Displays’ revenue will increase by 30% and that the combined acquisitions will be accretive to earnings within the next nine to twelve months, once transitioning activities are completed,” Mr. Wood concluded.

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