WALLA WALLA — Key Technology Inc. has announced the purchase of a Belgium-based company in a $21 million acquisition that will combine sorting technologies and create what Key calls an unparalleled equipment selection for food processing and industrial markets.
Under an agreement announced early this morning, Visys NV will become a wholly-owned subsidiary of Key. The transaction is scheduled for completion Thursday.
“Today is an exciting day for our employees, customers and shareholders, as we announce Key Technology’s acquisition of Visys,” Key President and Chief Executive Officer Jack Ehren said in a prepared statement. “This transaction represents a pivotal step in implementing our growth strategies, expanding our addressable markets and strengthening our leadership position as one of the world’s premiere providers of food processing equipment.”
Founded in 2004, Visys manufactures chute-fed in-air sorters used by food processors and waste recyclers. In 2012 sales were about $12 million.
Combined with Key’s belt-fed and optical sorters and conveyors, the transaction will result in the most complete source of high-performance, digital sorting technologies for food processing and industrial markets, the announcement said.
“This partnership with Visys creates a value proposition that is unmatched in the industry,” Ehren said in the announcement. “Through a single supplier, customers will have access to the highest performing chute-fed and belt-fed sorters available, along with our industry-leading processing systems and unparalleled support to satisfy needs in all steps of the processing line.”
Shareholders of the privately-owned Visys will receive about $13 million in cash, plus 600,000 shares of Key Technology common stock and 250,000 Key Technology warrants under terms of the agreement. The transaction is expected to result in added earnings per share within the first 12 months.
Visys President and Chief Executive Officer Frank Zwerts will become Key’s president of Europe, Middle East, India and Africa, where he is expected to have a pivotal role in Key’s global strategy and corporate development. He will also become Key’s seventh director on its board.
The merger will improve efficiencies for customers and bring together intellectual property, thus speeding the development of the next generation of sorting technology, said Ehren, who’s in Belgium today for the announcement.
“While there will be some internal reorganization as a result of the combination, we expect that it will present new opportunities for our employees,” he said.
Both companies’ various sorters are used to identify and remove foreign materials and defects from the product stream with optical and laser technologies. Sorters are used for everything from potatoes to nuts.
“Key and Visys each have industry-leading product, services and technologies that will be leveraged across each other’s existing markets, providing immediate benefit to our customers with the most complete range of high-performing digital sorting equipment in the world,” Ehren said.
Zwerts said joining forces will help expedite the “global penetration of Visys’s products into Key’s core markets and strategic new industries.
“In addition, the synergies that will be created by uniting our expertise and technologies provide significant growth opportunities for our customers and our combined company.”
Initially equipment for the companies will continue to be manufactured in their respective locations, Ehren said.
“Our goal is to effectively leverage and utilize our global manufacturing operations and to produce products closer to our customers. We will evaluate plans for manufacturing Visys sorters in the U.S., while still continuing to manufacture these and other products, in Belgium.”