4th Quarter and Full Fiscal Year 2018 Financial Results & Germane Systems Acquisition Overview
Acquisition of Germane Systems
Combination with Themis presents compelling value creation opportunity
Leading provider of rugged servers for C21 applications
Will integrate Germane with recently acquired Themis Computer
Complementary market focus; strategic program portfolio
• Creates $100M+ C21 rugged server business in less than 6 months
$45M purchase price); funded with existing revolver
Germane 10x gross purchase multiple of LTM adj. EBITDA
(2)
Germane 4x purchase multiple net of expected tax benefits and cost savings (³)
Themis and Germane combined ~9x net purchase price multiple
●
●
●
●
●
●
-
Germane accretive to fiscal 2019 adj. EPS
Slightly dilutive to fiscal 2019 gross margin and adj. EBITDA margin
-
Platform expected to achieve mid-point of target adj. EBITDA margin in FY20
Notes:
(1) Subject to net working capital and net debt adjustments.
(2) Acquisition of Germane Systems, a limited liability company, is treated as an asset purchase for tax purposes, resulting in $7M in net present value of tax benefits.
(3) Acquisition of Germane Systems is expected to yield $5M in run rate cost synergies.
© 2018 Mercury Systems, Inc.
5View entire presentation