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CAMBRIDGE, Ontario - ATS Corporation (TSX: ATS) (NYSE: ATS), a global provider of automation solutions, has entered into a definitive agreement to acquire the material assets of Heidolph Instruments GmbH & Co.
KG and Hans Heidolph GmbH, manufacturers of premium laboratory equipment. Pending the fulfillment of closing conditions outlined in the agreement, the acquisition will enhance ATS's offerings in the life sciences and pharmaceutical sectors.
Heidolph, established in 1938 with headquarters in Schwabach, Germany, is recognized for its laboratory equipment designed for evaporation, stirring, automation, shaking and mixing, liquid handling, and other essential lab functions.
The company's products and software solutions are pivotal for laboratory workflow automation and data documentation. In the fiscal year ending March 31, 2024, Heidolph reported revenues of approximately €50 million, with gross margins that are expected to be accretive to ATS's current margins. The company employs over 200 individuals across its facilities in Germany, the United States, South Korea, and China.
Andrew Hider, Chief Executive Officer of ATS Corporation, remarked on the strategic fit of Heidolph within ATS's portfolio, particularly for the ATS Life Sciences business.
Prakash 'Cash' Mahesh, Group Executive for ATS Life Sciences, also noted that the acquisition would expand the company's reach and customer base in critical life science segments.
The financial terms of the transaction have not been disclosed, but the purchase price is considered to be accretive to ATS's current trading multiple. The transaction is anticipated to close in the third calendar quarter of 2024. ATS plans to finance the acquisition through cash and its revolving credit facility.
ATS Corporation, founded in 1978, serves a diverse set of industries, including life sciences, transportation, food & beverage, consumer products, and energy.
The company employs over 7,000 people and operates more than 65 manufacturing facilities and over 85 offices globally. Its shares are traded on the Toronto Stock Exchange and the NYSE under the symbol "ATS."
This news article is based on a press release statement. Forward-looking statements in the press release involve risks and uncertainties that could cause results to differ from those projected.
ATS does not assume any obligation to update these forward-looking statements, which are based on management's current expectations and assumptions.
InvestingPro Insights
As ATS Corporation (NYSE: ATS) moves to expand its life sciences portfolio with the acquisition of Heidolph Instruments, investors and analysts are closely monitoring the company's financial health and stock performance. According to InvestingPro data, ATS Corporation has a market capitalization of $2.67 billion, reflecting its significant presence in the automation solutions industry. The company's P/E ratio currently stands at 19.08, which indicates the market's valuation of its earnings. Notably, the adjusted P/E ratio for the last twelve months as of Q4 2024 sits at 16.75, suggesting a more favorable valuation when considering near-term earnings growth.
InvestingPro Tips highlight that ATS's stock has experienced a notable decline over the last week, with a price total return of -7.65%. This short-term dip, coupled with the stock trading near its 52-week low, may catch the attention of value investors looking for potential entry points. Moreover, the company's liquid assets exceed its short-term obligations, which could be a sign of financial stability in the face of its latest acquisition endeavors. For those considering the long-term prospects, analysts predict ATS will be profitable this year, which aligns with the company's strategy to enhance offerings in the lucrative life sciences sector.
Investors looking for more in-depth analysis and additional InvestingPro Tips can find them at Investing.com/pro/ATS. Currently, there are 10 additional tips available that provide further insights into ATS Corporation's financial performance and stock trends.
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