AMHERST, N.Y. - Allied Motion Technologies Inc., a designer and manufacturer that sells precision controlled motion products and solutions to the global market, has acquired TCI, a developer and manufacturer of active (electronic) and passive (magnetic) products to resolve power quality and harmonic issues associated with industrial power conversion for $64.1 million. The purchase price was funded with existing cash plus borrowings under the Company’s revolving credit facility.
“TCI broadens and strengthens our position as a leading global diversified solutions provider in the controlled motion market,” commented Dick Warzala, chairman and CEO. “Their adjacent technologies and capabilities enable more efficient and longer life solutions for motion devices in a wide variety of demanding applications. We believe TCI’s technology and products will be a valuable addition to our expanding suite of solution offerings to further enhance the value creation opportunity that Allied brings to its customers. Additionally, TCI is expected to improve Allied’s overall margin profile and to be immediately accretive.”
Founded in 1961 and headquartered in Germantown, Wisconsin, TCI designs and manufactures products that monitor and improve power quality and extend motor life by reducing harmonic distortion associated with variable frequency drives (VFDs) and other power conversion equipment. With approximately 165 employees, TCI’s manufacturing capabilities include magnetic and electronic product assembly expertise to support a broad suite of power quality solutions that are used in oil and gas, HVAC, water and wastewater, and general industrial end markets primarily in the U.S. TCI expects 2018 revenue of approximately $45 million and has achieved above-market growth with a compound annual growth rate in the high single digits over the last three years.
Mr. Warzala added, “There is tremendous opportunity for growth potential with this acquisition as TCI has built longstanding relationships with blue-chip machinery OEMs, system integrators, consulting engineers and distributors. We believe their well-established North America distributor network can aid in our ongoing expansion of that channel and, equally important, we expect to leverage the Allied international footprint to further TCI’s global market penetration.”