CAMARILLO, CA-Advanced Photonix (API), a supplier of silicon-based optoelectronic technologies and products, signed a merger agreement to acquire Picotronix (Ann Arbor, MI) for $3.5 million in cash, four-year API promissory notes in the aggregate principal amount of $2.9 million, and 2,575,000 shares of stock. Upon the signing of the agreement, API agreed to provide a $4.2 million loan to Picometrix to prepay existing long-term indebtedness that Picometrix owes to a third party. The merger is expected to be final in April.
Picometrix is a developer and manufacturer of ultra high-speed photoreceivers used in telecommunication, data communication, and test & measurement markets, and terahertz instrumentation for scientific, industrial. and defense/homeland security markets. Its un-audited 2004 financial statements reflect revenues of $7.5 million, net income of $500,000, and long term liabilities of approximately $7 million and positive working capital of approximately $2 million as of December 31, 2004.
“As Picometrix, we endured the telecom restructuring and continued to make the necessary R&D investments … and (we) can now take advantage of API’s sales and marketing capabilities to accelerate penetration in the recovering telecom sector and API’s core markets,” said Rob Risser, CEO of Picometrix, who will join the API management team. “The merger also increases the resources available to accelerate our terahertz (T-Ray) product and application development to exploit the rapidly developing terahertz markets of homeland security and industrial non-destructive testing.”
According to Paul Ludwig, president of API, Picometrix provides the highest performing 40-Gb PIN detector and 10-Gb APD available in the market, which are a good complement to API’s silicon-based detector offerings. He said the combined company will work to accelerate growth opportunities in the telecom sector and leverage this technology into existing military, medical, and industrial customer bases.
“Picometrix will significantly expand API’s position in the telecom and test & measurement markets,” said Rick Kurtz, chairman and CEO of Advanced Photonix. “Picometrix brings design experience and processing expertise in III-V semiconductor materials, namely Gallium Arsenide (GaAs) and Indium Phosphide (InP). These materials give API additional optoelectronic sensing capabilities and solutions to offer our target markets. The added benefit of Picometrix’ proprietary terahertz sensor technology supports our goal of building on our manufacturing capabilities to provide complete, value-added sensor-based product offerings.”