PCB Technologies acquiring Rosh HaAyin-based AMS

PCB Technologies (TASE: PCBT), controlled by First Mezzanine Investors Opportunity Funds (FIMI), is acquiring electronics assembly company AMS for NIS 40 million in a cash and shares deal.

AMS, a former public company whose shares were delisted from trading three years ago, assembles electronic products and components, primarily as a subcontractor for electronics manufacturers in the medical, industrial, and communications sectors. Among other things, it deals with management of the supply chain, procurement of materials, electrical testing, and mechanical assembly.

PCB manufactures printed circuits and assembles components and systems; the two companies' activity is therefore synergetic. PCB's printed circuits are complex in flexibility, density, number of layers, and resistance to humidity. The company's main specialty is the production of small and medium-sized series on short notice. In assembly, the company undertakes projects in a variety of spheres and markets. Most of its sales are to customers in the security and medial markets.

AMS, which has 150 employees, is based in Rosh HaAyin. The company had a negligible NIS 468,000 operating profit and a NIS 384,000 net loss on NIS 40 million in revenue in the first half of 2018 and a NIS 2.6 operating profit and a NIS 82,000 net loss on NIS 79 million in revenue in 2017.

PCB will pay the five shareholders in AMS NIS 20 million and NIS 20 million more through an allocation of four million shares in PCB (including an option for some of the shareholders to be repaid NIS 32 million in owners' loans for shares).

In addition, PCB will allocate 1,087 options that can be converted into shares in the company within three years at a NIS 5.70 strike price, 11% above the market price. Completion of the deal is scheduled within three months, subject to various suspending conditions.

PCB says that acquisition of AMS is part of its goals and business strategy, and that AMS's activity in synergetic to its own. PCB believes that AMS will enable it "to expand and strengthen the company's fields of activity because of AMS's know-how and capabilities in electronics. The deal will also enable the company to expand and strengthen is customer base and its spheres of activity."

FIMI, led by founder and CEO Ishay Davidi, acquired a 51% controlling interest in PCB in March at NIS 3.60 per share, reflecting a NIS 243 million company value. PCB's share price has since risen 44%, boosting its market cap to NIS 350 million.

PCB CEO Oved Shapira said today, "AMS features a diverse customer base, a strong management team, and high profit margins for the industry in which it operates. The acquisition will enlarge PCB's circle of customers and enable the merged company to benefit from synergy that serves PCB's growth strategy in electronic assembly."

Published by Globes, Israel business news - en.globes.co.il - on October 24, 2018

PCB Technologies acquiring Rosh HaAyin-based AMS

Electronics assembly company AMS, which has 150 employees, lost NIS 384,000 on NIS 40 million revenue in the first half of 2018.