Celestica’s $329 Million Acquisition of Impakt Holdings

Moelis & Company LLC acted as exclusive financial advisor to Celestica, and Blake, Cassels & Graydon and Arnold & Porter as its legal counsel. Stifel and Lincoln International acted as financial advisors to Impakt.

Celestica, Inc. (NYSE, TSX: CLS), a leader in design, manufacturing and supply chain solutions for the world’s most innovative companies, today announced that it has entered into a definitive agreement to acquire Impakt Holdings, LLC.

Impakt is a highly-specialized, vertically integrated manufacturer providing manufacturing solutions for leading OEMs in the semiconductor and Organic Light Emitting Diode (OLED) display industries, as well as other markets requiring complex fabrication services. Founded in 1977, the company is headquartered in Santa Clara, with operations in California and South Korea.

Through this acquisition, Celestica expects to gain significant, new capabilities in large-format, complex, high-mix manufacturing solutions for multiple industries, and broaden its precision component manufacturing, full system assembly, integration and machining capabilities. In addition, Celestica anticipates that it will benefit from Impakt’s full spectrum of specialized vertical services including its South Korea-based machining and manufacturing expertise. In conjunction with Celestica’s current capital equipment business, Impakt’s vertical integration will enable Celestica to provide more efficient end-to-end product life cycle solutions across a diverse set of markets.

Celestica will purchase Impakt for US$329 million, and the transaction is expected to be accretive to consolidated non-IFRS operating margin* and overall ATS margin upon closing. We intend to finance the purchase price, which is subject to specific adjustments set forth in the definitive agreement, with a combination of borrowings under the company’s current credit facility. The acquisition is expected to close in the fourth quarter 2018, subject to receipt of applicable regulatory approvals and satisfaction of other customary closing conditions.

Arnold & Porter advised Celestica with a team including Corporate and Finance partner Joel Greenberg (Picture) and included counsel Sara Adler, associate Erin Iannotti, partner Laurie Abramowitz; associate Zeno Houston; partner Jeffrey London, counsel Brian Witkowski; counsel Kerry Dziubek, counsel Michael Sapienza; counsel Peter Danias; partner Axel Gutermuth, partner Ronald Henry; and associate Roxanne Mintz.

Involved fees earner: Joel Greenberg – Arnold & Porter Kaye Scholer LLP; Sara Adler – Arnold & Porter Kaye Scholer LLP; Erin Iannotti – Arnold & Porter Kaye Scholer LLP; Laurie Abramowitz – Arnold & Porter Kaye Scholer LLP; Zeno Houston – Arnold & Porter Kaye Scholer LLP; Jeffrey L. London – Arnold & Porter Kaye Scholer LLP; Brian Witkowski – Arnold & Porter Kaye Scholer LLP; Kerry Dziubek – Arnold & Porter Kaye Scholer LLP; Michael Sapienza – Arnold & Porter Kaye Scholer LLP; Peter Danias – Arnold & Porter Kaye Scholer LLP; Axel Gutermuth – Arnold & Porter Kaye Scholer LLP; Ronald Henry – Arnold & Porter Kaye Scholer LLP; Roxanne Mintz – Arnold & Porter Kaye Scholer LLP;

Law Firms: Arnold & Porter Kaye Scholer LLP;

Clients: Celestica Inc.;

Author: Ambrogio Visconti