San Diego-based RF Industries Ltd. recently announced that it has completed the acquisition of Rel-Tech Electronics Inc., a Milford, Conn.-based manufacturer of custom cable assemblies and wiring harnesses, for a purchase price of up to $3.1 million.
According to RF, the acquisition of all outstanding shares of Rel-Tech consists of $2.1 million in cash, 50,467 shares of RF’s common stock valued at $200,000 and, if certain financial targets are met over a three-year period, cash earn-out payments up to $800,000. Privately owned Rel-Tech had revenues of approximately $7.7 million for the calendar year 2014.
“Rel-Tech’s product lines are complementary to those of RF Industries and enable us to diversify and expand the company’s customer base and increase product distribution to the large North Eastern wireless market,” said Johnny Walker, president and CEO of RF Industries. “Rel-Tech, in combination with our Comnet and Cables Unlimited divisions, also provides us a growth opportunity to increase sales of the company’s growing line of fiber optic-based products. We anticipate that Rel-Tech will be accretive to the company’s profitability and cash flow in the third quarter of fiscal 2015.”
One of the two original founders of Rel-Tech, Ralph Palumbo, will remain as president, while Wilfred LeBlanc has agreed to a three-year consulting agreement with Rel-Tech, RF said.
RF Industries is a designer and manufacturer of interconnect products and complex cable assemblies across diversified, markets including wireless carriers and infrastructure, medical and industrial.