Codan to acquire Zetron
Codan has entered into an agreement to acquire 100 per cent of the shares in US-based company, Zetron, from JVCKENWOOD Corporation.
Zetron is a US-based company providing communications and interoperability solutions for public safety, transportation, utilities, healthcare and natural resources customers, and operates from locations in the US, Australia and the UK.
The acquisition comprises an upfront cash payment of US$45 million (approximately A$59 million), and is expected to be completed by 30 April 2021.
Zetron is expected to contribute approximately A$67 million of sales and A$8 million in EBITDA under Codan’s ownership in FY22 and therefore it will be earnings-per-share accretive.
“The acquisition of Zetron is in line with Codan’s well publicised strategy to transform our Communications businesses from products to solutions,” Donald McGurk, Chief Executive of Codan, said. “This acquisition allows us to capitalise on Zetron’s extensive distribution network, brand strength and customer loyalty.”
According to the company, Zetron offers a suite of integrated emergency response technologies which are complementary to Codan’s existing products. These include voice dispatch, emergency call taking including Next Generation 911 (NG911), mapping, computer aided dispatch and fire station alerting. An infrastructure bill which includes US$15 billion in NG911 funding is currently under consideration by the US Government. If passed, this will enhance emergency number services to allow voice, photos, videos and text messages to flow from the public to the 911 network.
“Zetron and Codan have a proud history of providing mission critical communications and the combination of the two companies will enable us to better meet our customers demand for integrated solutions,” Scott French, Codan’s President for Critical Communications, said. “By combining Codan’s land mobile radio products and solutions with Zetron’s command and control capability, we will be in a position to better serve the growing NG911 market, whilst maximising value and choice for our customers.”
Codan says it expects to increase R&D funding in order to achieve a market leading position across both businesses.