Amphenol (APH) has acquired Halo Technology Limited for $715 million, with an aim to strengthen its offering and tap the long-term market growth opportunity.
Noatbly, shares of the high-tech interconnect, antenna and sensor solutions provider have gained 22% over the past year.
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Headquartered in California, Halo is a leading provider of active and passive fiber optic interconnect components catering to the communications infrastructure markets. It has operations in North America and Europe, and is expected to generate sales of $250 million in 2021.
The addition of Halo’s product offerings will complement Amphenol’s existing high-speed and fiber optic interconnect solutions. The deal is expected to be immediately accretive to earnings in the first year upon closing the acquisition.
Concurrent with the news, Amphenol also revealed the closing of the sale of the MTS Test & Simulation business to Illinois Tool Works Inc. (ITW).
Management Weighs In
President and CEO of Amphenol, R. Adam Norwitt, commented, “Halo’s high-technology products strengthen our offering to IT and data communications, mobile networks and broadband customers, all of whom are upgrading their systems and networks to manage increased data traffic.”
He further added, “We look forward to working closely with Halo’s experienced management team to deliver a broader range of interconnect solutions to our customers around the world.”
Consensus among analysts is a Strong Buy based on 5 Buys and 1 Hold. The average Amphenol price target of $85.17 implies 6.48% upside potential from current levels.
APH scores an 8 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.