FLIR Systems has commenced a cash tender offer worth $274 million to acquire ICx Technologies, a company that supplies advanced sensing equipment based on photonic and other technologies.
Upon the successful closing of the tender offer, shareholders of ICx are set to receive $7.55 in cash for each share of ICx common stock tendered in the offer. However, last week the New York-based legal company Faruqi & Faruqi announced that it would be investigating the ICx board about the sale.
The legal firm believes that the $7.55 tender offer may undervalue ICx, because “at least one” financial analyst has valued the company’s common stock at $10. Its investigation will focus on whether the ICx board failed to conduct an adequate and fair sales process to sell the company, and how much the proposed sale might undervalues ICx by.
Details of the deal were first announced on August 16, at which point the board of directors of both FLIR and ICx had approved the deal. ICx is 62 percent-owned by Wexford Capital, which has agreed to sell its share to FLIR.
Raman and fluorescence expertise
FLIR describes ICx as “a leading provider of integrated advanced sensing technologies for homeland security, force protection and critical infrastructure applications”. It offers a broad range of detection and surveillance technologies, supported by a strong intellectual property portfolio and reported revenue of approximately $168 million for the year ended June 30, 2010.
Specific photonics-related products offered by ICx include infrared imagers operating in the 8-12 µm wavelength range, ideal for heat sensing, as well as both Raman-based and fluorescence screening products for detecting explosives. ICx also offers CCD-based surveillance products that offer a combination of infrared, visible and millimeter-wave detection.
Once completed, the acquisition will expand FLIR's capabilities into advanced sensors for chemical, biological, radiological, nuclear, and explosives (CBNRE) detection for defense and homeland security markets. It will also enhance FLIR's existing intelligence surveillance and reconnaissance product line-up through the addition of ICx's advanced radars and integrated platforms.
Earl Lewis, president and CEO of FLIR, said of the deal: "The transaction presents an attractive opportunity to add ICx's market leading CBRNE technologies to FLIR's product portfolio and leverage FLIR's global infrastructure to reduce costs and drive growth. We look forward to welcoming ICx's employees to FLIR."