Materion Corporation acquires Optics Balzers

With the focus on the company’s growth strategy, the shareholders of Optics Balzers have been looking for new business opportunities: On Monday, June 8, 2020, Materion Corporation, a US-based company listed on the New York Stock Exchange, announced that a definitive agreement had been reached to acquire Optics Balzers AG in cash.

“We serve one of the most attractive growth markets and the key factor of success is growth,” says Detlev Häusler. He is CEO of Optics Balzers with headquarters in Liechtenstein and locations in Germany and Malaysia. The company generates total sales of around 67 million dollars per year. Optics Balzers is privately owned and is an industrial partner for the development and production of coated optical components and assemblies as well as a leading supplier of thin film coatings. In order to consistently pursue the company’s growth strategy, the shareholders of Optics Balzers have decided to sell the company to Materion, a leading company for precision coatings and novel high-performance materials based in Ohio, USA. In 2019, the group generated total sales of around 1.2 billion dollars. Materion is acquiring 100 percent of the shares.

The employees are taken over

Following an extensive evaluation process with regard to a takeover, Häusler is convinced that it has achieved a viable deal, which is still subject to antitrust review and is expected to be completed in the third quarter of 2020. “We assume that all employees at all locations will be taken over, as the focus of the takeover is on growth and not on cost reduction.

The new owners are aware of the strong brand value of Optics Balzers. Thanks to the new shareholder, Optics Balzers will be able to implement its global expansion strategy more quickly and better exploit opportunities”.

Higher market penetration

Materion will be a strong shareholder and will implement a growth roadmap with Optics Balzers. The acquisition is a long-term commitment to the markets and production facilities of Optics Balzers, which will be an important part of Materion’s precision coatings business. The merged company will be instrumental in achieving greater market penetration based on a broader product portfolio. Materion is a global supplier of precision components used in the telecommunications, consumer electronics, automotive, medical, industrial, aerospace, defense and optical coating industries.

Complementary structures

The structures of the two companies are complementary: Optics Balzers benefits from the distribution strength of Materion in the USA, and Materion benefits from the strength of Optics Balzers in Europe. Current market developments have made it clear that Optics Balzers could achieve further growth targets with an additional site in the USA. In addition, the Optics plant in Malaysia fits in with Materion’s strategic intentions. The market portfolio and regional presence complement each other well and show little overlap. The business potential can also be exploited in the area of technologies.

Investments will continue

“We assume that the investments will continue at all three Optics Balzers sites,” says Häusler. High-end coating technologies from Materion (e.g. infrared) would be established in Balzers, which would allow the European market to be served in addition to Optics Balzers’ existing product portfolio. In Jena, Germany, the sophisticated coatings for life sciences, industry and aerospace would be strengthened, Häusler expects. In Penang, Malaysia, Materion is expected to contribute to the establishment of additional projects to expand diversification.

More growth thanks to acquisition

With this acquisition Materion significantly expands its market area for optical coatings; it now extends beyond the core of North America to Europe and Asia. Complementary technologies across the entire electromagnetic spectrum enhance the capabilities of the combined portfolio and enable Materion to benefit from important megatrends in the life sciences, consumer goods and industrial sectors.
“We have long had great respect and appreciation for the business of Optics Balzers. Their technical capabilities, product portfolio, end market and geographic mix combined with their talented management team make them the ideal partner to accelerate our global growth in optical coatings,” said Jugal Vijayvargiya, President and Chief Executive Officer of Materion.
Credit Suisse acted as financial advisor and Bär & Karrer as legal counsel to the sellers.

For more information, please visit: https://www.opticsbalzers.com/