Danaher Closes Keithley Acquisition - Analyst Blog

Washington-based, Danaher Corporation (DHR) completed its previously announced acquisition of Keithley Instruments Inc (KEI). The transaction was unanimously approved by Keithley's board of directors in September, 2010.

As per the terms of the transaction, Danaher acquired all the outstanding common shares and Class B common shares of Keithley at $21.60 per share for a total cash consideration of $300 million, including debt and net of cash. The acquired assets were integrated with Danaher's Test & Measurement platform included in the Professional Instrumentation segment.

Danaher is a diversified technology company that designs, manufactures and markets innovative products and services, which are typically characterized by strong brand names, proprietary technology and major market positions. Its revenue is chiefly derived from sale of professional, medical, industrial, commercial and consumer products.

Keithley acquisition will be a growth booster for Danaher's Tektronix business by strengthening its offerings in the scientific general purpose test instrument market. Keithley is one of the leading companies engaged in producing electronic instruments and systems geared to the specialized needs of engineers at electronic manufacturers and academic institutions.

In the third quarter of 2010, the company's top line increased roughly 16% year over year while the bottom line registered a 33% increase. Revenue from the Professional Instrumentation segment, encompassing Test & Measurement and Environmental platforms, accounted for 10.4% of total revenue with an increase of 20.6% year over year.

The company faces stiff competition from its peers including General Electric Co. (GE), SPX Corporation (SPW), and privately held Siemens Water Technologies. We currently maintain a Neutral recommendation on the stock.

 
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