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SMTC enters merger agreement with investment firm
EMS provider SMTC Corporation has entered into a definitive merger agreement with an affiliate of H.I.G. Capital, a global alternative investment firm.
Under the terms of the merger agreement, an affiliate of H.I.G. will acquire all outstanding shares of SMTC's common stock for USD 6.044 per share in cash, which represents a premium of approximately 22% over SMTC Corporation’s closing share price on December 31, 2020. The board of directors of SMTC has unanimously approved the merger agreement and recommends that the company’s stockholders adopt it. “Over the past three years, the team at SMTC has done an excellent job of transforming the Company into a global leader among mid-size providers of end-to-end Electronics Manufacturing Services (“EMS”) by offering superior supply chain management, and proactive services and solutions to an expanding base of customers,” says Ed Smith, President and CEO of SMTC, in a press release. “Partnering with H.I.G. will enable us to accelerate our growth through continued investment in our customers, capabilities, and footprint.” “In addition to delivering immediate value to our stockholders, this investment provides SMTC Corporation with a long-term partner with an extensive track record of supporting its portfolio companies with operational expertise, technology and financial management experience. Together, we believe we can capitalize on strategic growth opportunities, while continuing to meet the needs of our customers by delivering high-quality, innovative solutions and services,” the CEO continues. The transaction, which is subject to the receipt of approval from SMTC’s stockholders, antitrust clearance, and other customary closing conditions, is expected to close by the second quarter of 2021. “We are pleased to partner with Eddie Smith and his team. They have done an outstanding job over the past three years serving some of the most attractive end EMS markets, including Aerospace & Defense, Industrial IoT, 5G, and Medical & Safety. With its industry-leading solutions and strong customer relationships, we believe there is significant opportunity to invest in SMTC’s customers and capabilities to further expand the Company’s leadership position. We look forward to partnering with SMTC’s talented management team and employees to serve its customers with best-in-class solutions, build upon its existing capability excellence, and help SMTC achieve its full potential,” says Phillip Wood-Smith, Managing Director of H.I.G.