SYS-CON MEDIA Authors: Carmen Gonzalez, Dana Gardner, Elizabeth White, Yeshim Deniz, Peter Silva

News Feed Item

GSI Group Announces Closing of JADAK LLC Acquisition

BEDFORD, Mass., March 17, 2014 /PRNewswire/ -- GSI Group Inc. (NASDAQ: GSIG) (the "Company", "we", "our", or "GSI"),  a leading global supplier of precision photonics and motion control components and subsystems to the medical, industrial, electronics and scientific markets, today announced the closing of its acquisition of JADAK LLC and JADAK Technologies Inc. (together, "JADAK"), a North Syracuse, New York-based provider of optical data collection and machine vision technologies to medical device original equipment manufacturers ("OEM's"), for $93.5 million in cash.  As a result of this transaction, JADAK is now a wholly owned subsidiary of GSI.   

GSI Group Inc. Logo

JADAK's technology consists of barcode components and scanners, machine vision cameras, RFID technology, magnetic stripe readers, portable platforms and associated software.  JADAK's products are highly engineered, application-specific components that are developed and manufactured to meet the extremely high performance and quality requirements of major medical OEMs, which use JADAK's products to increase safety and reduce medical errors by verifying patient identity, validating the specified therapy or function and enhancing the accuracy of the medical procedure. 

The total purchase price of $93.5 million was financed using a combination of cash on hand and the Company's newly amended credit facility.  In addition to the total purchase price, the Company has granted restricted stock units ("RSUs") in an aggregate of 180,000 shares to the four owner managers of the JADAK business.  These RSUs will be eligible to vest after two years if certain financial targets have been achieved.  These RSU awards are intended to be employment inducement awards pursuant to NASDAQ rules.   

The Company expects to finish the first quarter of 2014 with approximately $140 million of gross debt, and slightly more than $100 million of net debt.  The Company defines net debt, a non-GAAP measure, as total debt minus cash and cash equivalents.  

The transaction is expected to be accretive to GSI's non-GAAP free cash flow and earnings in 2014.  JADAK is expected to add approximately $40 million in revenue and approximately $7.5 million in Adjusted EBITDA, a non-GAAP financial measure, to GSI's financial results for 2014.  In addition, GSI expects to realize greater than $12 million of cash tax benefit from the "step-up" in the basis of the acquired assets of JADAK.  See "Safe Harbor and Forward Looking Information" below.

Use of Non-GAAP Financial Measures

This press release includes non-GAAP financial measures, net debt, Adjusted EBITDA, free cash flow, which are not financial measures prepared in accordance with generally accepted accounting principles ("GAAP"). The Company defines Adjusted EBITDA as the net income attributable to GSI Group Inc. before deducting interest, income taxes, depreciation, amortization, non-cash share-based compensation, restructuring, acquisition, divestitures, and other non-recurring costs, income from discontinued operations, net of tax, and other non-operating income/expense items, including foreign exchange gains/losses and earnings from an equity-method investment. Management believes Adjusted EBITDA provides meaningful supplementary information regarding the Company's operating results because it excludes amounts that management does not consider as part of operating results when assessing and measuring the operational and financial performance of the Company. Adjusted EBITDA is used by management to evaluate operating performance, communicate financial results to the Board of Directors, benchmark results against historical performance and the performance of peers, evaluate investment opportunities including acquisitions and divestitures, and determine the bonus payments for senior management and employees. The Company believes this non-GAAP measure provides greater transparency and insight into management's method of analysis.

Because of the forward-looking nature of the forecasted Adjusted EBITDA figure included in this press release, specific quantification of the amounts that would be required to reconcile net income to Adjusted EBITDA is not available. The Company believes that there is a degree of volatility with respect to the Company's and JADAK's net income which precludes it from providing accurate forecasted GAAP to non-GAAP reconciliations. Based on the above, the Company believes that providing such a reconciliation for the forecasted Adjusted EBITDA figure would imply a degree of precision that would be confusing or misleading to investors.

Safe Harbor and Forward Looking Information

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based on current expectations and assumptions that are subject to risks and uncertainties. All statements contained in this press release that do not relate to matters of historical facts should be considered forward-looking statements, and are generally identified by words such as "expect," "intend," "anticipate," "estimate," "plan," "aim," "pro forma," and other similar expressions. These forward-looking statements include, but are not limited to, statements related to: the Company's expected future financial performance, liquidity and tax benefits after the acquisition of JADAK, and other statements that are not historical facts.

In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Assumptions relating to the foregoing are inherently speculative and involve judgments and risks with respect to a number of matters that are difficult or impossible to predict accurately and many of which are beyond the control of GSI. Certain of these judgments and the types of risks that could affect the outcome of the events set forth in these statements and that could affect the Company's operating results and financial condition are discussed in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and in the Company's subsequent filings with the SEC made prior to or after the date hereof. Although GSI believes that the assumptions underlying the forward-looking statements in this press release are reasonable, any of the assumptions could prove inaccurate, and future events and results may differ materially from current projections or expectations as described in this press release. Therefore, there can be no assurance that the results contemplated in the forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation, by GSI or any other person, that results set forth in such forward-looking statements will be achieved. GSI also undertakes no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent expressly required by applicable law.

About JADAK

Headquartered in North Syracuse, New York, JADAK is a manufacturer of optical data collection technologies with a proven record of providing product and system solutions for medical companies requiring barcode, RFID, machine vision and camera based technologies.  JADAK has established itself as a strategic partner for today's top healthcare companies through its flexible, customer centric approach and its wide range of capabilities.  More information about JADAK is available at JADAK's website at www.jadaktech.com.

About GSI

GSI Group Inc. designs, develops, manufactures and sells precision photonics and motion control components and sub-systems for applications demanding extremely high levels of performance. Our technology is targeted primarily at Original Equipment Manufacturers for incorporation into products and systems for a wide range of applications in major markets including: medical, industrial, electronics and scientific.  GSI Group Inc.'s common shares are listed on NASDAQ (GSIG).

More information about GSI is available on the Company's website at www.gsig.com.  For additional information, please contact GSI Group Inc., Investor Relations, at (781) 266-5137 or [email protected].

Logo - http://photos.prnewswire.com/prnh/20120305/NE64445LOGO

SOURCE GSI Group Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
The Internet of Things is not new. Historically, smart businesses have used its basic concept of leveraging data to drive better decision making and have capitalized on those insights to realize additional revenue opportunities. So, what has changed to make the Internet of Things one of the hottest topics in tech? In his session at @ThingsExpo, Chris Gray, Director, Embedded and Internet of Things, discussed the underlying factors that are driving the economics of intelligent systems. Discover ...
Avnet, Inc. has announced that it ranked No. 4 on the InformationWeek Elite 100 – a list of the top business technology innovators in the U.S. Avnet was recognized for the development of an innovative cloud-based training system that serves as the foundation for Avnet Academy – the company’s education and training organization focused on technical training around top IT vendor technologies. The development of this system allowed Avnet to quickly expand its IT-related training capabilities around...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo in Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading in...
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using ...
A new definition of Big Data & the practical applications of the defined components & associated technical architecture models This presentation introduces a new definition of Big Data, along with the practical applications of the defined components and associated technical architecture models. In his session at Big Data Expo, Tony Shan will start with looking into the concept of Big Data and tracing back the first definition by Doug Laney, and then he will dive deep into the description of 3V...
Why does developer experience matters, what makes for a great developer experience and what is the relationship between developer experience and the broader field of user experience? Software developers are gaining more influence over the purchase decisions of technologies with which they must build on and with which they must integrate. For example, the success of Amazon Web Services, Heroku and MongoDB has been driven primarily by individual software developers choosing to use these tools, ra...
The cloud has transformed how we think about software quality. Instead of preventing failures, we must focus on automatic recovery from failure. In other words, resilience trumps traditional quality measures. Continuous delivery models further squeeze traditional notions of quality. Remember the venerable project management Iron Triangle? Among time, scope, and cost, you can only fix two or quality will suffer. Only in today's DevOps world, continuous testing, integration, and deployment upend...
Cloud and Big Data present unique dilemmas: embracing the benefits of these new technologies while maintaining the security of your organization's assets. When an outside party owns, controls and manages your infrastructure and computational resources, how can you be assured that sensitive data remains private and secure? How do you best protect data in mixed use cloud and big data infrastructure sets? Can you still satisfy the full range of reporting, compliance and regulatory requirements? In...
There are lots of challenges in IoT around secure, scalable and business friendly infrastructure for enterprises. For large corporations, IoT implementations are one of the top priorities of the decade. All industries are seeing a competitive need to sustain by investing in IoT initiatives. The value addition comes from improved customer service, innovative product and additional revenue streams. The data from these IP-connected devices can be leveraged for a variety of business applica...
Chuck Piluso will present a study of cloud adoption trends and the power and flexibility of IBM Power and Pureflex cloud solutions. Speaker Bio: Prior to Data Storage Corporation (DSC), Mr. Piluso founded North American Telecommunication Corporation, a facilities-based Competitive Local Exchange Carrier licensed by the Public Service Commission in 10 states, serving as the company's chairman and president from 1997 to 2000. Between 1990 and 1997, Mr. Piluso served as chairman & founder of ...
Between the compelling mockups and specs produced by your analysts and designers, and the resulting application built by your developers, there is a gulf where projects fail, costs spiral out of control, and applications fall short of requirements. In his session at DevOps Summit, Charles Kendrick, CTO and Chief Architect at Isomorphic Software, will present a new approach where business and development users collaborate – each using tools appropriate to their goals and expertise – to build mo...
While Docker continues to be the darling of startups, enterprises and IT innovators around the world, networking continues to be a real mess. Indeed, managing the interaction between Docker containers and networks has always been fraught with complications. Without automation in networking, the vision of running Docker at scale and letting IT run the same apps unchanged on the laptop and in the data center or for any cloud cannot be realized.
To manage complex web services with lots of calls to the cloud, many businesses have invested in Application Performance Management (APM) and Network Performance Management (NPM) tools. Together APM and NPM tools are essential aids in improving a business's infrastructure required to support an effective web experience... but they are missing a critical component - Internet visibility. Internet connectivity has always played a role in customer access to web presence, but in the past few years u...
Working with Big Data is challenging, especially when decision makers depend on market insights and intelligence from your data but don't have quick access to it or find it unusable. In their session at 6th Big Data Expo, Ian Khan, Global Strategic Positioning & Brand Manager at Solgenia; Zel Bianco, President, CEO and Co-Founder of Interactive Edge of Solgenia; and Ermanno Bonifazi, CEO & Founder at Solgenia, discussed how a revolutionary cloud-based BI along with mobile analytics is already c...