Cyient India said on January 24 that it signed a definitive agreement to acquire 100 percent of the shares of Florida-based Certon Software, an IP-led innovative provider of full product life-cycle engineering services.
Cyient did not disclose the financial terms of the agreement. However, it added that the transaction would be EPS accretive.
Reacting to the news, shares of Cyient jumped over 4 percent on Tuesday on the BSE. The shares last traded at Rs 484 at 11:00 am.
Incorporated in 2006, Certon Software has revenue at the current runrate of approximately $6 million and sustainable low double digit EBITDA margins. The company has a team strength of around 45 people.
Certon also has strong Field Programmable Gate Array (FPGA) and System on Chip (SoC) full product life-cycle capabilities and continues to build IP tools for various portions of the Avionics value chain, especially independent verification and validation (V&V).
Hyderabad-based Cyient is a provider of engineering design, manufacturing, digital and technology services. With over 13,800 employees, the company has operations in 21 countries.
This is Cyient's fifth acquisition in the last two-and-a-half years as part of its Design-Build-Maintain strategy. The Indian company said it has a strong cash position of $127 million and will continue to look for acquisitions.
Commenting on the agreement, Anand Parameswaran, Cyient's senior vice president and BU Head for Aerospace and Defence said: "This acquisition will enable Cyient to create a differentiated value proposition in Avionics that aligns with our Aerospace and Defence strategy of becoming a key Design Led Manufacturing (DLM) player in this space. We expect the industry to have continued investment in avionics driven by technology changes and obsolescence and this acquisition will aid Cyient in strengthening our presence in the avionics market."
Last week, Cyient said that it commenced operations in Warangal from the Incubation Center of the Telangana State Industrial Infrastructure Corporation (TSIIC).