2016 saw consolidation in the test and instruments industry.
There was a series of mergers and acquisitions over the course of the year in the T&M industry. Major ones were:
March 2016 saw two acquisitions. Spirent Communications Plc acquired Testing Technologies. Founded in 2000, Testing Technologies is a leader in automation software quality tools. With its flagship platform TTworkbench, Testing Technologies is focused on test automation for the automotive and IoT industries. As the automotive industry moves to IP networks and automakers begin to realize their vision of the connected car, the acquisition of Testing Technologies will enable Spirent to offer the most effective solution available to ensure the functionality and performance of next-generation automobile components and technologies.
Similarly, the Internet of Things (IoT) is creating an explosion of devices, diverse communication protocols, and traffic on today’s network infrastructure. This combination of Testing Technologies with Spirent creates the perfect marriage between machine-to-machine automation and IP stress-testing solutions for the IoT market.
Averna, an industry-leading developer of test solutions and services for communications and electronics device-makers worldwide, announced 100 percent acquisition of Europe-based Test & Measurement Solutions (T&M Solutions).
Averna’s main shareholders, Tandem Expansion and Caisse de dépôt et placement du Québec (CDPQ), both participated in the financing of this acquisition. For CDPQ, this investment is consistent with its objective to further the international expansion of high-performing Quebec companies.
T&M Solutions develops multidisciplinary solutions to test, measure, inspect, assemble, and validate products in nearly all segments of the production industry. Headquartered in Belgium and with offices in the Netherlands and Poland, T&M Solutions is a National Instruments Gold Alliance Partner and has 100 employees, including 70 engineers with almost 50 NI certifications.
This acquisition increases Averna’s global reach as well as provides a strong local presence in Europe, enabling Averna to enter this market with a well-established and respected solution provider while giving it a springboard for further European deployments. In addition, T&M Solutions brings unique expertise in semiconductor testing, vision inspection systems and precision assembly to complement Averna’s existing solutions and industry strengths.
Teledyne LeCroy, Inc.
In April 2016, Teledyne Technologies Incorporated announced that Teledyne LeCroy, Inc. has acquired Frontline Test Equipment, Inc. (Frontline). Headquartered in Charlottesville, Virginia, Frontline provides electronic test and measurement instrumentation and is a market leader in wireless protocol analysis test tools.
Protocol analyzers are used by engineers to troubleshoot data communication systems and test device interoperability, compliance, and interference. Frontline’s protocol tools intercept, log traffic, and analyze data that passes over digital wireless networks. The company’s analyzers span a wide range of technologies, including Bluetooth®, 802.11 (Wi-Fi), and near-field communication (NFC), and are used by hundreds of companies globally in the consumer electronics, semiconductor, telecommunications, and automotive industries.
Teledyne LeCroy Inc. also entered into an agreement to acquire Quantum Data, Inc., the market leader in HDMI and SDI signal generators and protocol analyzers as well as test tools for other digital video technologies.
In August, Platinum Equity completed the acquisition of Electro Rent Corporation for approximately USD 382 million, which represents a purchase price of USD 15.50 per share of Electro Rent common stock.
Danaher Corporation has completed the separation of its test and measurement segment, industrial technologies segment (other than its Product Identification platform), and Retail/Commercial Petroleum platform through the spin-off of Fortive Corporation. Fortive includes the Tektronix, Fluke, and Keithley brands and in two quarters of reporting, has already generated USD 3.2 billion in revenue.
InfoVista finalized its acquisition of Ascom Network Testing (TEMS) on August 22, 2016.
The TEMS portfolio will complement InfoVista’s network planning, optimization, and service assurance solutions to enable a more complete view of the service delivery chain and improve the way CSPs and MNOs are balancing profitability with superior customer experience.
This acquisition will combine the industry-leading active network testing capabilities of TEMS along with InfoVista’s rich network performance, real-time data collection, and analytics capabilities. Such a combination will enable a unique correlation between the critical dimensions of network experience – the network, the subscriber, and the service. These capabilities are not only unique in the market, but also key for MNOs looking at implementing a modern and efficient customer experience management (CEM) approach.
Anritsu Corporation (Atsugi City, Kanagawa, Japan), acquired Azimuth Systems, Inc. (Acton, Massachusetts, USA), a leading provider of automated, real-world RF performance test solutions, in September 2016. Azimuth Systems became a subsidiary of Anritsu. Anritsu, with the integration of Azimuth’s intellectual property, product portfolio and installed base, expands its test solutions, leveraging the strengths of both companies in the growing IoT and 5G markets.
EXFO Inc. acquired the majority of the assets of Absolute Analysis Inc., including technology, expertise, and solutions in the area of radio frequency (RF) testing for fiber-based radio access networks (RANs) in October 2016.
This acquisition is driven by EXFO’s commitment to provide market-leading solutions to mobile network operators (MNOs) in their quest to deploy next-generation, fiber-based front-haul networks and RAN architectures. In a market where subscriber quality of experience is a profitability game changer, MNOs have little room for error while pressure is increasing to deploy faster and minimize operating expenses.
To address these challenges, EXFO is combining its cutting-edge optical and Ethernet test technologies with those of Absolute Analysis, a privately held company in Newbury Park, California. Absolute Analysis’ solutions are critical for identifying and analyzing RF interference issues in fiber-to-the-antenna (FTTA), distributed antenna systems (DAS), remote radio heads (RRHs), and baseband units (BBUs) that support 4G/LTE and soon 5G wireless mobility and IoT. Absolute Analysis’ technology delivers highly efficient CPRI (common public radio interface) protocol analysis and emulation as well as RF over CPRI spectrum analysis.
EXFO has already integrated a portion of Absolute Analysis’ technology into the recently launched OpticalRFTM application for its FTB-1 Pro test platform, a compact, lightweight, and powerful solution that allows MNOs to quickly and easily locate all RF interference issues in fiber-based mobile networks.
This cash-and-stock transaction is valued at approximately USD 8.25 million, including USD 5 million in cash and the remaining amount in EXFO shares.
In November 2016, ElectroRent entered into an agreement to acquire Microlease from Lloyds Development Capital. The transaction is expected to close during Q1 2017.
Both companies are leaders in testing and measurement equipment rental, sales, and asset management services. ElectroRent is a portfolio company of Platinum Equity, which acquired the business in August 2016.
Rohde & Schwarz Cybersecurity
Rohde & Schwarz Cybersecurity acquired all DenyAll shares from its shareholders. Headquartered in Paris, DenyAll will continue to be managed by the same management team, including Jacques Sebag, its current CEO. The acquisition is a significant step toward Rohde & Schwarz Cybersecurity’s goal to become the leading European cybersecurity vendor. The all-share transaction closed on December 20, 2016.
The spate of acquisitions continued in 2017 with National Technical Systems, Inc., (NTS) and Bureau Veritas, France, both announcing purchases in January.
National Technical Systems
The leading independent provider of qualification testing, inspection, and certification solutions in North America, NTS acquired Fiarex of Chambly, Quebec, and CEM of Boucherville, Quebec. Fiarex specializes in dynamic and environmental testing, while CEM specializes in electromagnetic compatibility and interference testing (EMC and EMI). Both companies serve a number of market-leading customers in the aerospace, defense, automotive, rail, consumer, and other industries.
Bureau Veritas announced the acquisition of SIEMIC, Inc., an American testing and certification body for electrical and electronic equipment, active in the Silicon Valley and in Asia. Established in 2003, SIEMIC provides market access services for electrical and electronic products in the telecoms, consumer, automotive, and medical sectors and works with global manufacturers, including many of the world’s leading brands. SIEMIC provides a comprehensive range of testing, certification, and international approvals management services. Its headquarters and main operations are located in Milpitas, Silicon Valley, USA; however, it also benefits from testing facilities in both California and China and branch offices in Taiwan. As a leading telecommunications certification body (TCB), SIEMIC issues thousands of certifications per year to attest compliance with Federal Communications Commission regulations in the USA for wireless and telecommunications equipment. It generated an estimated revenue of EUR 9.5 million in 2016.
Keysight Technologies Inc. has on January 30 reached a deal to buy Ixia for about USD 1.6 billion in a move to expand its software-centric business and expand its intellectual property portfolio. The combination will create a technology business that spans electronic design, device and network validation, and application and security performance.
While Keysight provides electronic design and test solutions to communications and electronics industries, Ixia provides testing, visibility, and security solutions for physical and virtual networks for enterprises, service providers, and network equipment makers. Ixia’s intellectual property portfolio includes networking and wireless protocols that will extend Keysight’s position in wireless communications.
The all-cash deal is expected to close by October. Keysight has already entered into voting agreements with shareholders with 23 percent of Ixia’s outstanding stock.