API Technologies Corp. (ATNY.OB) Announces Acquisition of Kuchera Group

The company announced today that it has acquired substantially all of the assets of the Kuchera Group of Companies, including Kuchera Defense Systems Inc. and Kuchera Industries Inc. The Kuchera Group of Companies is a US-based defense subcontractor specializing in sophisticated electronics and highly-engineered systems for the communications, defense and aerospace industries.

Under the terms of the transaction, API Technologies acquired the assets of Kuchera for $24 million and common stock. $14 million is payable in cash and $10 is financed with a short-term note from the sellers, plus 3.2 million shares of the company’s common stock. The shares will be issued in three tranches over a period of two years. The cash portion of the purchase was funded through a $20 million debt facility.

The Kuchera acquisition looks to be a solid move for API Technologies. Kuchera generated about $65 million in revenues for the 12-month period ended June 30, 2009 and has a current backlog of over $65 million. The company has a broad product line including printed circuit boards, robotic systems, unmanned aircraft, electro-mechanical assemblies and final systems integration. In addition, their client base includes Fortune 100 companies such as Boeing.

The CEO of API Technologies, Stephen B. Pudles, was enthusiastic about the deal stating, “The acquisition of the assets of the Kuchera Group of Companies is a transformational step forward for our company in becoming a true leader in the defense subcontracting industry. Together with our existing business, the new combined entity will be better positioned to serve our global clients, including governments around the world.”