Welcome!

News Feed Item

GSI Group Announces Closing of JADAK LLC Acquisition

BEDFORD, Mass., March 17, 2014 /PRNewswire/ -- GSI Group Inc. (NASDAQ: GSIG) (the "Company", "we", "our", or "GSI"),  a leading global supplier of precision photonics and motion control components and subsystems to the medical, industrial, electronics and scientific markets, today announced the closing of its acquisition of JADAK LLC and JADAK Technologies Inc. (together, "JADAK"), a North Syracuse, New York-based provider of optical data collection and machine vision technologies to medical device original equipment manufacturers ("OEM's"), for $93.5 million in cash.  As a result of this transaction, JADAK is now a wholly owned subsidiary of GSI.   

GSI Group Inc. Logo

JADAK's technology consists of barcode components and scanners, machine vision cameras, RFID technology, magnetic stripe readers, portable platforms and associated software.  JADAK's products are highly engineered, application-specific components that are developed and manufactured to meet the extremely high performance and quality requirements of major medical OEMs, which use JADAK's products to increase safety and reduce medical errors by verifying patient identity, validating the specified therapy or function and enhancing the accuracy of the medical procedure. 

The total purchase price of $93.5 million was financed using a combination of cash on hand and the Company's newly amended credit facility.  In addition to the total purchase price, the Company has granted restricted stock units ("RSUs") in an aggregate of 180,000 shares to the four owner managers of the JADAK business.  These RSUs will be eligible to vest after two years if certain financial targets have been achieved.  These RSU awards are intended to be employment inducement awards pursuant to NASDAQ rules.   

The Company expects to finish the first quarter of 2014 with approximately $140 million of gross debt, and slightly more than $100 million of net debt.  The Company defines net debt, a non-GAAP measure, as total debt minus cash and cash equivalents.  

The transaction is expected to be accretive to GSI's non-GAAP free cash flow and earnings in 2014.  JADAK is expected to add approximately $40 million in revenue and approximately $7.5 million in Adjusted EBITDA, a non-GAAP financial measure, to GSI's financial results for 2014.  In addition, GSI expects to realize greater than $12 million of cash tax benefit from the "step-up" in the basis of the acquired assets of JADAK.  See "Safe Harbor and Forward Looking Information" below.

Use of Non-GAAP Financial Measures

This press release includes non-GAAP financial measures, net debt, Adjusted EBITDA, free cash flow, which are not financial measures prepared in accordance with generally accepted accounting principles ("GAAP"). The Company defines Adjusted EBITDA as the net income attributable to GSI Group Inc. before deducting interest, income taxes, depreciation, amortization, non-cash share-based compensation, restructuring, acquisition, divestitures, and other non-recurring costs, income from discontinued operations, net of tax, and other non-operating income/expense items, including foreign exchange gains/losses and earnings from an equity-method investment. Management believes Adjusted EBITDA provides meaningful supplementary information regarding the Company's operating results because it excludes amounts that management does not consider as part of operating results when assessing and measuring the operational and financial performance of the Company. Adjusted EBITDA is used by management to evaluate operating performance, communicate financial results to the Board of Directors, benchmark results against historical performance and the performance of peers, evaluate investment opportunities including acquisitions and divestitures, and determine the bonus payments for senior management and employees. The Company believes this non-GAAP measure provides greater transparency and insight into management's method of analysis.

Because of the forward-looking nature of the forecasted Adjusted EBITDA figure included in this press release, specific quantification of the amounts that would be required to reconcile net income to Adjusted EBITDA is not available. The Company believes that there is a degree of volatility with respect to the Company's and JADAK's net income which precludes it from providing accurate forecasted GAAP to non-GAAP reconciliations. Based on the above, the Company believes that providing such a reconciliation for the forecasted Adjusted EBITDA figure would imply a degree of precision that would be confusing or misleading to investors.

Safe Harbor and Forward Looking Information

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based on current expectations and assumptions that are subject to risks and uncertainties. All statements contained in this press release that do not relate to matters of historical facts should be considered forward-looking statements, and are generally identified by words such as "expect," "intend," "anticipate," "estimate," "plan," "aim," "pro forma," and other similar expressions. These forward-looking statements include, but are not limited to, statements related to: the Company's expected future financial performance, liquidity and tax benefits after the acquisition of JADAK, and other statements that are not historical facts.

In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Assumptions relating to the foregoing are inherently speculative and involve judgments and risks with respect to a number of matters that are difficult or impossible to predict accurately and many of which are beyond the control of GSI. Certain of these judgments and the types of risks that could affect the outcome of the events set forth in these statements and that could affect the Company's operating results and financial condition are discussed in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and in the Company's subsequent filings with the SEC made prior to or after the date hereof. Although GSI believes that the assumptions underlying the forward-looking statements in this press release are reasonable, any of the assumptions could prove inaccurate, and future events and results may differ materially from current projections or expectations as described in this press release. Therefore, there can be no assurance that the results contemplated in the forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation, by GSI or any other person, that results set forth in such forward-looking statements will be achieved. GSI also undertakes no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent expressly required by applicable law.

About JADAK

Headquartered in North Syracuse, New York, JADAK is a manufacturer of optical data collection technologies with a proven record of providing product and system solutions for medical companies requiring barcode, RFID, machine vision and camera based technologies.  JADAK has established itself as a strategic partner for today's top healthcare companies through its flexible, customer centric approach and its wide range of capabilities.  More information about JADAK is available at JADAK's website at www.jadaktech.com.

About GSI

GSI Group Inc. designs, develops, manufactures and sells precision photonics and motion control components and sub-systems for applications demanding extremely high levels of performance. Our technology is targeted primarily at Original Equipment Manufacturers for incorporation into products and systems for a wide range of applications in major markets including: medical, industrial, electronics and scientific.  GSI Group Inc.'s common shares are listed on NASDAQ (GSIG).

More information about GSI is available on the Company's website at www.gsig.com.  For additional information, please contact GSI Group Inc., Investor Relations, at (781) 266-5137 or [email protected].

Logo - http://photos.prnewswire.com/prnh/20120305/NE64445LOGO

SOURCE GSI Group Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
"We view the cloud not really as a specific technology but as a way of doing business and that way of doing business is transforming the way software, infrastructure and services are being delivered to business," explained Matthew Rosen, CEO and Director at Fusion, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
In addition to all the benefits, IoT is also bringing new kind of customer experience challenges - cars that unlock themselves, thermostats turning houses into saunas and baby video monitors broadcasting over the internet. This list can only increase because while IoT services should be intuitive and simple to use, the delivery ecosystem is a myriad of potential problems as IoT explodes complexity. So finding a performance issue is like finding the proverbial needle in the haystack.
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, discussed how research has demonstrated the value of Machine Learning in delivering next generation analytics to imp...
"We host and fully manage cloud data services, whether we store, the data, move the data, or run analytics on the data," stated Kamal Shannak, Senior Development Manager, Cloud Data Services, IBM, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Large scale deployments present unique planning challenges, system commissioning hurdles between IT and OT and demand careful system hand-off orchestration. In his session at @ThingsExpo, Jeff Smith, Senior Director and a founding member of Incenergy, will discuss some of the key tactics to ensure delivery success based on his experience of the last two years deploying Industrial IoT systems across four continents.
With the proliferation of both SQL and NoSQL databases, organizations can now target specific fit-for-purpose database tools for their different application needs regarding scalability, ease of use, ACID support, etc. Platform as a Service offerings make this even easier now, enabling developers to roll out their own database infrastructure in minutes with minimal management overhead. However, this same amount of flexibility also comes with the challenges of picking the right tool, on the right ...
With over 720 million Internet users and 40–50% CAGR, the Chinese Cloud Computing market has been booming. When talking about cloud computing, what are the Chinese users of cloud thinking about? What is the most powerful force that can push them to make the buying decision? How to tap into them? In his session at 18th Cloud Expo, Yu Hao, CEO and co-founder of SpeedyCloud, answered these questions and discussed the results of SpeedyCloud’s survey.
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
DevOps at Cloud Expo – being held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Am...
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
“We're a global managed hosting provider. Our core customer set is a U.S.-based customer that is looking to go global,” explained Adam Rogers, Managing Director at ANEXIA, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.