Mergers & Acquisitions

Mergers & Acquisitions

August 15, 2011

Electro Rent Acquires Assets of Equipment Management Technology, Inc

Electro Rent Corporation, an organization which rents, leases and sells electronic test equipment, personal computers and servers, has announced that it has purchased the assets of Equipment Management Technology, Inc. (“EMT”) for a price of $11.1 million. Electro Rent acquired EMT, provider of electronic test equipment, which had earlier this year filed for bankruptcy protection, in a private sale which was carried out in a U.S. Bankruptcy court.

EMT essentially serves the aerospace/defense industry by providing it with new and used electronic test equipment which it either rents, leases or sells.

Adjustments to the $11.1 million purchase price will be made after taking into account changes in EMT's net accounts receivable and revenue and after carrying out equipment inventory both during and after closing. 

Electro Rent is expecting the transaction, which received the U.S. Bankruptcy court's stamp of approval, to go through on August 19, 2011.

In a release, Daniel Greenberg, Chairman and CEO of Electro Rent said that “EMT’s electronic test equipment business is well matched to our own. This strategic transaction will deepen our equipment portfolio to help ensure that we are continually surpassing our mutual customers’ needs and expectations, while providing them with an expanded range of cost-effective solutions.”

Electro Rent also announced that it is expecting relative increase in costs because of the recent acquisition during the actual takeover of EMT’s equipment inventory and its customer base. The company said there will be substantial problems while shifting EMT's operations to its headquarters; however it is expecting an increase in its earnings once the acquisition and takeover are complete.  

Greenberg said that “We remain committed to sharing our strong history of service excellence and responsiveness with EMT’s customers. Our solid balance sheet provides us with considerable flexibility, allowing us to act quickly when strategic opportunities to drive growth arise. This acquisition will serve us well as we work toward becoming one of the world’s most recognized test and measurement and telecommunications capital equipment business partners.”

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Calvin Azuri is a contributing editor for TMCnet. To read more of Calvin’s articles, please visit his columnist page.

Edited by Rich Steeves

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