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Teledyne buys Flir for $8bn to expand its sensing portfolio

05 January, 2021

The US industrial conglomerate Teledyne Technologies is buying the infrared imaging giant Flir Systems in a cash-and-stock deal worth around $8bn. Although both companies are active in the sensing market, they say that their technologies and markets are “perfectly complementary … with minimal overlap”.

“At the core of both our companies is proprietary sensor technologies,” explains Teledyne’s executive chairman, Robert Mehrabian. “Our business models are also similar: we each provide sensors, cameras and sensor systems to our customers. However, our technologies and products are uniquely complementary with minimal overlap, having imaging sensors based on different semiconductor technologies for different wavelengths.”

While Flir is strong in areas such as thermography, airborne imaging and the automotive, consumer and security markets, Teledyne has an expertise in aerospace and subsea sensing technologies. And while Flir focuses on infrared frequencies, Teledyne is active in the X-ray, ultraviolet, microwave and radio spectra.

All of Flir’s revenues of around $1.9bn come from digital imaging, while this represents less than a third (32%) of Teledyne’s $3.1bn annual income. Its biggest market is instrumentation, accounting to 36% of its revenues, with aerospace and defence electronics representing 19%, and engineered systems contributing 13%. The combined business is expected to generate revenues worth around $5bn, with 59% of this coming from digital imaging.

“Together, we will offer a uniquely complementary end-to-end portfolio of sensory technologies for all key domains and applications across a well-balanced, global customer base,” says Flir’s president and CEO, Jim Cannon. “We are pleased to be partnering with an organisation that shares our focus on continuous innovation and operational excellence, and we look forward to working closely with the Teledyne team as we bring our two companies together to capitalize on the important opportunities ahead.”

“Flir’s commitment to innovation spanning multiple sensing technologies has allowed our company to grow into the multi-billion-dollar company it is today,” adds Flir’s chairman, Earl Lewis. “With our new partner’s platform of complementary technologies, we will be able to continue this trajectory, providing our employees, customers and stockholders even more exciting momentum for growth. Our board fully supports this transaction, which delivers immediate value and the opportunity to participate in the upside potential of the combined company.”

Flir was established in 1978 to pioneer the development of high-performance, low-cost infrared thermal imaging systems for airborne applications. Toward the end of the 1980s, it started to use its infrared expertise to develop hand-held and laboratory systems for a variety of commercial applications that needed good image quality and the ability to detect and measure temperature differences.

Flir is active in a wide range of infrared-based sensing technologies

In 1998, Flir acquired the Swedish-based infrared specialist Agema and, in 1999, US-based Inframetrics to expand its commercial thermal imaging activities. In 2003, it added Indigo Systems.

Flir has invested in numerous adjacent markets, technologies and products to expand its portfolio and to service a wider range of customers. These investments have led to significant growth, helping to cut product costs, and resulting in “dramatic” increases in customer numbers, and an increased awareness of thermal technologies. Flir currently employs more than 3,000 people.

Teledyne expects the deal to close in mid-2021 and to add to its earnings in the first full year after acquisition.

Teledyne:   LinkedIn

Flir:           Twitter  LinkedIn

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