MINNEAPOLIS (AP) -- Packaging instrument maker Mocon Inc. said Monday it will buy Denmark's PBI-Dansensor A/S for $20 million, expanding Mocon's access to overseas customers and increasing its product line.
Both Mocon and Dansensor make quality control instruments for the packaging of food and drug products. Mocon makes an instrument that measures how much air escapes from a sealed package, for example. The Minneapolis company also offers consulting services to packaging companies.
Dansensor's international sales network will help Mocon push its products into new markets without investing in new distribution networks there, Mocon CEO Robert Demorest said in a statement. Most of Mocon's revenue comes from U.S. customers.
The deal is expected to close around April 2. Mocon said the deal should be a slight drag to its 2012 earnings, but should start boosting its net income by 2013.
Mocon will pay two-thirds of the $20 million purchase price in cash, with the rest being paid over four years through a seller note. A seller note is a form of debt financing that lets a company pay for an acquisition with installment payments.
The deal could immediately increase Mocon's revenue by half. In 2011, Dansensor recorded sales of about $19.3 million. Together, Mocon and Dansensor would have had combined revenue of $56.7 million last year.
Shares of Mocon rose 53 cents, or 3.1 percent, to $17.53 in morning trading.
