Averna, a global provider of test and quality solutions, has acquired Global Equipment Services, Inc. (GES), a division of Kimball Electronics, Inc. (NASDAQ: KE) to effectively increase its global presence and capabilities in automation and test solutions for various industries, including consumer electronics, semiconductors, and medical devices.
The acquisition brings Averna's total workforce to 1,200 employees and expands its operations to 20 offices across 11 countries. New locations will be established in key Asian and North American regions, namely Ho Chi Minh, Vietnam; Suzhou, China; Trivandrum, India; Tokyo, Japan; and San Jose, United States. Technical support will also be available in the Philippines, Taiwan, South Korea, Malaysia, and Thailand.
François Rainville, President and CEO of Averna, emphasized the strategic importance of the acquisition, stating that it was crucial to establish a significant presence where their customers' research, development, and manufacturing activities are concentrated.
The acquisition is seen as a perfect match due to GES's extensive automation, vision, and test engineering capabilities, as well as its impressive client database.
GES, previously part of Kimball Electronics, brings to Averna a rich portfolio of technical skills, including optical metrology, image processing, and micro-alignment of components. Their expertise in providing a broad range of automation and inspection equipment is expected to complement Averna's services.
With the addition of over 160,000 square feet of manufacturing space, including class 100K and 10K clean rooms, Averna is poised to address large-scale customer challenges globally.
This expansion reinforces Averna's position as a leader in test, measurement, and quality solutions, offering specialized expertise and innovative solutions that deliver significant benefits to clients in various industries.
InvestingPro Insights
The recent acquisition by Averna of Global Equipment Services, a division of Kimball Electronics (NASDAQ: KE), is a strategic move that not only expands Averna's global footprint but also merges with a company that, according to InvestingPro Tips, trades with low price volatility and is expected to be profitable this year. This stability and positive outlook may contribute to the combined entity's operational synergy and financial robustness.
InvestingPro Data highlights that Kimball Electronics has a market capitalization of $592.38 million and is trading at a price-to-earnings (P/E) ratio of 18.81. Although the company's gross profit margin is considered weak at 8.6%, it is important to note that its liquid assets exceed short-term obligations, which indicates sound liquidity management—a critical factor in the success of such strategic expansions.
Moreover, the company's revenue over the last twelve months as of Q3 2024 stands at $1.78 billion, with a modest growth of approximately 4.69%. This growth, coupled with the fact that Kimball Electronics is trading at a low revenue valuation multiple, suggests that the company might be undervalued, potentially offering a value play for investors. As for forward-looking performance, despite the expectation of a net income drop this year, analysts remain optimistic about the company's profitability.
For readers interested in a deeper analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/KE, which could provide further insights into Kimball Electronics' financial health and market position following this acquisition.
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