PARIS – Lectra, an industrial solutions specialist developing CAD and CAM cutting systems for soft materials such as leather and textiles, has announced a plan to acquire Gerber Technology in a deal worth around €300 million.
Gerber Technology had 2020 revenues of €165 million in 2020. Thanks to the strong value creation deriving from significant synergies between the two parties, Lectra expects the transaction to be accretive for shareholders from 2022. For more than 50 years, Gerber Technology has used its proprietary technologies and deep domain expertise to provide integrated software and automated hardware solutions to companies around the world, including more than 100 Fortune 500 companies in 134 countries.
Lectra designs software, equipment and data services for manufacturers in the furniture, fashion and automotive industries. Upon completion, the acquisition would allow Lectra to complement its market position and continue to enhance its cutting-edge technology based offerings to help customers boost the productivity and profitability of their operations.
Under the proposed acquisition, Lectra would acquire all outstanding shares of Gerber Technology on a cash-free debt-free basis for an upfront payment of €175 million – through a combination of cash and debt – plus 5 million newly issued Lectra shares to AIPCF VI LG Funding LP, an affiliate of American Industrial Partners that is Gerber Technology’s sole shareholder. This would represent the total amount of about €300 million based on Lectra’s closing share price on Feb. 5. No contingent consideration is contemplated.
Completion of the acquisition remains subject to merger control clearance and other customary conditions and will be submitted to Lectra shareholders for approval.
The proposed combination would occur at an opportune time for both companies and their customers. The current uncertain economic climate and unprecedented challenges that fashion, automotive and furniture companies are facing due to the COVID-19 pandemic make it more important than ever for them to transform, digitalize and optimize their operations.
The strategic combination of Gerber Technology and Lectra will create a premier advanced technology partner, able to quickly meet changing customer needs and deliver even more value through seamlessly integrated solutions. Together, the two companies will have a large installed base of product development software and automated cutting solutions in operation, with a worldwide presence and a long list of prestigious customers.
Consolidating the two companies’ research and development capabilities will enable the combined company to accelerate development of Industry 4.0 technologies and help its expanded customer base seize the full potential of these innovations.
“It has been an honor to lead the transformation of Gerber Technology and create an efficient, comprehensive platform that enables our customers’ digital transformation initiatives,” said Mohit Uberoi, CEO of Gerber Technology in a release. “Gerber Technology and Lectra share a long history of innovation and excellent customer service that, brought together, will create an even stronger company that provides best-in-class technology solutions and services to our customers globally.”
The combined company’s broader global reach will allow it to boost service capabilities to customers around the world thanks to greater resources and the joint force of Gerber Technology and Lectra’s sales and support teams.
Integrating the technology of the two companies will endow them with the resources to anticipate and address rapidly changing market conditions.
“Today is a historic day for our companies that will bring tremendous opportunities for future growth,” said Lectra Chairman and CEO Daniel Harari. “We will have investments in innovation and technological capabilities that will be highly beneficial to the industry. They will allow us to create long-term value for our customers and our shareholders. We’re delighted to welcome Gerber Technology’s group of talented professionals to the Lectra team. Unifying the two teams will showcase the strength of our fantastic employees. Together, we will be able to grow and expand the services we provide to our customers and help them accelerate their digital transformation.”
Upon closing of the transaction, Daniel Harari would own around 14.6% of the Lectra shares, and AIPCF VI LG would own around 13.3%, and a director representing AIPCF VI LG would join the Lectra board.
Daniel Harari would continue as chairman and CEO of Lectra. Gerber Technology CEO Mohit Uberoi would assume a role as special advisor to Harari role until the end of this year.
Lectra’s shareholders would be invited to vote on the issuance of the 5 million new Lectra shares reserved to AIPCF VI LG at a dedicated Extraordinary Shareholders’ Meeting, which is currently expected to be held on April 30. A report containing additional information will be mad