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RF Industries upgrades portfolio with CUI buy

Posted: 16 Jun 2011 ?? ?Print Version ?Bookmark and Share

Keywords:acquisition? cable connectors? cable assembly?

RF Industries Ltd has announced that it has signed a definitive agreement to buy Cables Unlimited Inc. for cash and equity consideration worth approximately $5.6 million. CUI's revenue in its most recent 12 months ended December 31, 2010 was approximately $6.2 million. The company has a non-audited non-GAAP adjusted EBITDA of approximately $645,000.

The purchase price is subject to working capital adjustments at the closing, payable half in cash and half in shares of unregistered RFI common stock.

It is anticipated that RFI will pay approximately $2.8 million in cash and issue approximately 760,000 shares of common stock to the seller at closing. The transaction is expected to close on or about June 15, 2011.

"Cables Unlimited's product line adds high value fiber-optic cabling and connector products to our own interconnect and wiring products. Their modern facilities will provide RFI with an East Coast presence, enabling improved services to our largest customers. We believe this acquisition will be accretive to RFI's earnings in the current fiscal year ending October 31, 2011," said Howard Hill, president and CEO of RF Industries, in a statement.

"Many of our OEM customers have West Coast operations and this combination provides CUI with the opportunity to geographically expand our sales and OEM product line. We look forward to a long and profitable relationship," said Darren Clark, president and CEO of Cables Unlimited Inc.

RF Industries conducts operations through six related divisions. The RF connectors and cable assembly segment designs and distributes radio frequency (RF) coaxial connectors and cable assemblies used for WiFi, PCS, radio, test instruments, computer networks and antenna devices.

CUI designs and manufactures custom cables, wire harnesses and electromechanical assemblies for aerospace, medical, industrial, consumer, appliance, automotive and computer electronics applications.

Nicolas Mokoff
??EE Times

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