Updated: Tektronix to join Fluke in Danaher stable - Embedded.com

Updated: Tektronix to join Fluke in Danaher stable

LONDON — The Tektronix board of directors is recommending an acceptance of all-cash offer for the company from Danaher Corp.at $38.00 per share making the aggregate purchase price is approximately $2.8 billion, including debt, transaction costs and net of cash acquired. Tektronix reported a 2007 profit of $90.4 million on sales of $1.11 billion.

The offer price represents a premium of approximately 34 percent to Tektronix’s (Beaverton, Ore.) closing price on Oct 12 and the transaction is expected to be completed before the end of 2007.

Tektronix would become part of Danaher's (Washington, D.C) Electronic Test platform, joining the Fluke and Fluke Networks businesses, and nearly doubling the platform’s revenues. Danaher bought Fluke (Everett, WA) in 1998 for $625 million.

Vibes coming from Beaverton were that Tektronix management expected the company to operate as a wholly-owned subsidiary keeping its headquarters in Oregon. Rick Wills, Tektronix chief executive officer indicated that Danaher has committed to allowing Tektronix continue operating as a separate company, so it will maintain the Tektronix brand. Wills said that there is only a 5 percent overlap between the Tektronix and Fluke ranges

“We believe this is a compelling transaction for Tektronix shareholders and that the combined efforts of Danaher and Tektronix will extend the leadership position we have built in our served markets throughout the world,” said Wills.

Danaher's President and CEO, H. Lawrence Culp, Jr., added “With its well recognized brand, significant global reach and broad based expertise in providing solutions for end-users in research and product development for high-growth industries we believe Tektronix provides an excellent complement to our existing Electronic Test business. We have long admired Tektronix's product innovation and excellent reputation.”

Tektronix has concentrated on higher end test equipment of oscilloscope and logic analyzers while Fluke has traditonally made handheld and more prortable instruments such as multimeters and power supplies. Fluke had bolstered its range in 1993 by buying most of the Philips test & measurement division with which it had asix-year long development alliance which produced the ScopeMeter.

Less than a decade ago Tektronix was a more diversified company with divisions producing the Phaser-branded color printers, sold to Xerox in 2000 for around $1billion, and the Grass Valley TV and video products which went private in 1999 before being snapped up by Thomson Multimedia in 2002.

Earlier Tektronix was famed for producing virtually all its components and assemblies from knobs to displays in-house it even had its own semiconductor fab in Beaverton which it sold to Maxim Integrated Products in 1994.

The company had a long-term marketing agreement with Rohde & Schwarz (Munich, Germany) and was often rumored to be interested in buying up its privately owned German-partner partner but that never happened and the cooperation ended in 2004.

In June Tektronix raised $345 million from institutional investors and used approximately $110 million of the net proceeds from the offering to purchase approximately 3.2 million shares of its common stock. It planned to continue this share buy-up and acquire approximately $300 million worth of shares of its common stock within one year.

In its financial year to the Mar 26, 2007 of sales were up 3 percent over the previous year and were the highest in six years. “Orders in our instruments business were especially strong driven by our general purpose test products which grew over 15 percent year-over-year, and we introduced an unprecedented number of major products. In our communications business, we grew sales 4 percent in a difficult market environment and continued to deliver market-leading solutions,” said Wills.

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