LONDON, UK: MTI Wireless Edge Ltd subsidiary MTI Summit Electronics has entered into a share purchase agreement, which includes both a purchase of existing shares in and the making of a new equity investment into PSK, after which MTI Summit will own 51% of PSK.
The initial consideration for the acquisition is approximately US$1.2 million, with an earn out payment subject to performance of up to approximately US$2.56 million. In addition, MTI Summit will make a loan to PSK of US$0.8 million and is party to an option agreement in relation to the acquisition of the remaining 49% of PSK.
PSK is an Israeli company which is well known to MTI having collaborated together on numerous projects over the past 10 years. PSK specialises in the development, manufacture and integration of communication systems and advanced monitoring and control systems for the Government and defence industry market.
Moni Borovitz, CEO of MTI, commented: “We are delighted with this Acquisition, which the Board expects to be earnings enhancing and will contribute to our future profits. The Acquisition will enable MTI Summit to step up the value-chain in the Israeli defence market by offering not only components, but also turn-key solutions. We have been in discussions with PSK for nearly a year and waited to see the recovery in its order book and project quotation activity prior to executing the Acquisition.
Over the past 18 months PSK was effected by COVID-19 and a lack of Government budget in Israel, which led to reduced spending and delays in projects and commitments from PSK’s existing and potential customers.
In recent months this has improved, with an increase in orders and opportunities, which has given us confidence in PSK’s immediate growth potential. The synergies between PSK and MTI’s Antenna division and Distribution & Professional Consulting Services division are significant. We expect that MTI’s strength and size will assist PSK in increasing its customer base and involvement in the market, while enabling MTI to offer a wider range of higher value products to customers.”
Headquartered in Israel, MTI is a technology group focused on comprehensive communication and radio frequency solutions across multiple sectors.
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