Magnetek Inc. has agreed to be purchased by Columbus McKinnon for a total value of $188.9 million.
That represents $50 per share of publicly traded Magnetek (Nasdaq: MAG), whose shares were trading at $32.35 before the announcement but jumped to $49.48 this afternoon.
The all-cash transaction value will be funded through a combination of cash and credit, according to a Columbus McKinnon news release. It is the second substantial acquisition for Columbus McKinnon in 2015, as it announced the purchase of a privately owned German manufacturer for $30 million in January.
Columbus McKinnon (Nasdaq: CMCO) designs, manufactures and markets material handling products.
Menomonee Falls-based Magnetek designs and manufactures digital power and motion control solutions for material handling, elevators and mining applications. It is the largest independent supplier of digital drives, radio controls, software and accessories for industrial cranes and hoists, and is also the largest independent supplier of digital direct current motion control systems for elevators.
The transaction has been approved unanimously by the boards for both companies. Columbus McKinnon president and CEO Timothy Tevens said the move will combine Magnetek's technology with Columbus McKinnon products and create new market opportunities the companies could not have pursued alone.
Magnetek has about 340 employees and sales over the past year of $112.2 million (from the second quarter of its 2014 fiscal year through the first quarter of the 2015 fiscal year).
Magnetek president and CEO Peter McCormick will remain with the company following the acquisition and continue to lead the Magnetek business and help integrate the two companies.