Technitrol completes purchase of Danish firm

Electronic-components-maker Technitrol Inc., of Trevose, announced yesterday the closing of its $410 million purchase of Sonion A/S, a Danish maker of components for hearing aids and other audio equipment.

The acquisition, the largest in Technitrol's 61-year history, was financed with bank debt and cash on hand.

"Technitrol has made 18 acquisitions since 1996, and this is the largest," said David Stakun, the company's vice president for corporate communications.

The trend in electronics is for smaller components and miniaturization of user devices.

Combining the two companies will leverage Technitrol's expertise in high-volume precision manufacturing with Sonion's business in "high-growth adjacent markets," including hearing, health, acoustics and medical, Technitrol said.

"Sonion offers valuable expertise in the design and development of superminiature electronics parts," Technitrol chairman and chief executive officer James M. Papada III said.

The combination of products "will help us better serve existing customers and capture new ones," he said.

Technitrol offers Sonion "decades of experience" in high-volume precision manufacturing in low-cost locations, along with established global sales, marketing and supply-chain-management networks, Papada said.

Sonion gives Technitrol low-cost manufacturing in Vietnam, but "at a relatively early development stage," so that "financial upside" from the manufacturing strategy "is still to be realized," the company said.

Sonion, based in Roskilde, Denmark, with operations in Poland, China, Vietnam and the Netherlands, employs about 4,900 people and has more than 500 active patents. The firm expects 2008 revenue to exceed $200 million.

Technitrol employs 26,000 worldwide and had 2007 revenue of $1.027 billion. It has about 80 employees in the Philadelphia area.

The acquisition will add about 25 cents to Technitrol's per-share earnings in 2009, the company said.

Sonion makes hearing-instrument components for hearing aids, high-end earphones, medical devices and wireless handsets. It developed an advanced acoustical technology, called MEMS, with much smaller microphones than conventional handset microphones.

Technitrol makes electronics components, including magnetic-based parts and modules, automotive and cell phone antennas, and automotive coils for ignition and other uses. The company also makes electrical-contact products for switches and circuit breakers, appliances and cars.

Sonion's hearing-instrument-components business will become a division of Technitrol's electronics-components business. Its mobile-terminal-components business will be combined with a Technitrol division that includes antennas and radio-frequency components and modules.

Technitrol shares were down 35 cents at $22.64 yesterday on the New York Stock Exchange.