ASSA ABLOY AB (OTC:ASAZY) recently entered into a definitive deal to acquire LUX-IDent. Conditional upon regulatory approvals and customary closing conditions, the deal is anticipated to conclude in the fourth quarter of 2019. The financial terms of the transaction were kept under wraps.
ASSA ABLOY’s share price increased 0.8% to close at $10.77 on Thursday.
Based in Lanškroun, Czech Republic, LUX-IDent is primarily engaged in producing and marketing various transponders for applications that ranges from access and security to industrial logistics. LUX-IDent’s core expertise lies in the manufacture of radio frequency identification (RFID) inlays in frequency bands of 125 kHz and 13.56 MHz. Notably, its products — including prelaminated inlays, HF & NFC inlays, UHF inlays, smart labels and glass transponders — have a strong customer base in Europe with growing base in the United States and Canada.
The buyout will enable ASSA ABLOY to strengthen its RFID component offerings. Backed by expanded product offerings in the RFID components segment, the company expects to gain access to a larger customer base, particularly in the central and eastern Europe region. Notably, ASSA ABLOY expects this acquisition to be neutral to its earnings per share from the beginning.
Other Inorganic Moves
A notable inorganic move by the company was the acquisition of Australia-based Placard in September 2019. The buyout will enable the company to strengthen its secure cards offering, particularly in the Australasia region. In addition, it completed the buyout of LifeSafety Power in the same month. Notably, this buyout will help ASSA ABLOY in strengthening its offerings within the access control portfolio.
Further, the company entered into an agreement to purchase the U.K.-based De La Rue’s international identity solutions business in June 2019. Notably, this buyout is likely to boost ASSA ABLOY’s secure identity solutions offerings.
ASSA ABLOY currently carries a Zacks Rank #4 (Sell). Year to date, the stock has gained 21.4% compared with the industry’s growth of 24.6%.
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