By Calvin Biesecker
FLIR Systems [FLIR] said Monday evening that it has completed its acquisition of ICx Technologies, bolstering its suite of products in the security space by giving it radar to go with its imaging and laser systems and providing a slew of detection products.
FLIR said the $7.55 per share purchase price amounted to an aggregate price of $268 million, or $232 million, including ICx’s closing cash balance. ICx is now a subsidiary of FLIR.
"The acquisition of ICx represents an opportunity to expand our business into several attractive adjacent technologies, products, and markets," Earl Lewis, FLIR’s president and CEO, said in a statement. "We believe ICx is a leader in emerging CBRNE (chemical, biological, radiological, nuclear and explosive) sensor technologies and that this business will create substantial value for our shareholders."
Stephens Inc., security analyst Tim Quillin, who likes FLIR’s long-term prospects, said yesterday in a research note that the ICx acquisition "looks like a project," although he believes the deal also has "meaningful long-term upside" for FLIR. In the near-term, though, he said that for FLIR to maintain its gross margins it will likely trim ICx’ business mix away from lower margin contract research and development, which currently accounts for about 30 percent of sales. He expects ICx’ sales may be down next year as FLIR improves the sales mix.
Longer term, Quillin believes some of the upside in the ICx acquisition will accrue from FLIR cross-selling its new portfolio of CBRNE sensors to existing FLIR customers.