TE Connectivity Ltd. (TEL) has completed the regulatory procedures and closed the all-cash SEACON deal worth $490 million. The acquisition of SEACON Group extends TE Connectivity’s range of connectivity solutions to the lucrative oil & gas sector. Announced on Apr 3, 2014 and scheduled to close in fiscal year 2014, the deal has been completed by the company well in advance.
The SEACON Group takeover positions TE Connectivity as the leader in connectivity solutions for environmental applications. In Apr 2012, TE Connectivity had acquired Deutsch, a major provider of high-performance connectivity solutions for rough environments, to better serve customers in the Industrial and Commercial Transportation, Aerospace and Defense, and Rail markets. The acquisition was valued at €1.55 billion.
The SEACON group primarily caters to the military marine and sub-sea sectors for remotely operated vehicles (:ROV)/autonomous underwater vehicles (AUV.V), oil and gas, environmental and oceanographic applications. Therefore, through this acquisition, TE Connectivity intends to integrate its cable product line with SEACON’s fiber optic capability and Deutsch’s power connector range to create a comprehensive product portfolio for undersea applications.
TE Connectivity is the market leader in the connectivity business with a comprehensive portfolio. The company’s four segments together command a $100 billion market share. Moreover, TE Connectivity’s business is expected to grow at an annual rate of 5% for the next 5 years.
TE Connectivity currently has a Zacks Rank #2 (Buy). Other well-performing stocks in the industry include KEMET CORP. (KEM), Maxwell Technologies Inc. (MXWL) and Ballard Power Systems Inc. (BLDP). While KEMET and Maxwell sport a Zacks Rank #1 (Strong Buy), Ballard Power Systems carries a Zacks Rank #2 (Buy).