Bel Fuse Inc., Jersey City, N.J., continues to grow its business through acquisitions with the recent purchase of Power-One Power Solutions business of ABB Ltd. for approximately $117 million in cash. Revenue in 2013 for the Power Solutions business was approximately $251 million. The acquisition is expected to close in the second quarter of 2014 and to be immediately accretive to Bel’s earnings.
Power Solutions, headquartered in San Jose, Calif., manufactures high‑efficiency and high‑density power conversion products for server, storage and networking equipment, industrial applications and power systems. It has manufacturing facilities in Slovakia and China. Products include standard, modified‑standard and custom designed AC/DC, DC/DC and other specific power conversion products for a variety of technologies in data centers, telecommunications and industrial applications.
“The key drivers behind the acquisition are Power One’s strong long-term technical presence in the power conversion market, and synergies with Bel’s products and market directions,” said Mark Coggan, North American sales director, Bel Stewart Connector, San Diego, Calif. “The merging of the product sets will create one of the broadest power portfolios in the market.”
The acquisition also will help Bel grow its business in the rail and transportation markets “Their solid industrial offering will allow us to expand our efforts in rail and transportation markets, and be synergistic with much of the work that we have been doing in those markets, as well as the aerospace and military markets through our Cinch Connector group.”
The acquisition is not expected to change its current distribution network. Coggan said both companies have relationships with many of the same distributors and expects the acquisition will deepen those partnerships “through increasing opportunities for growth.”
In terms of consolidation, the company is not at a stage where it can discuss the topic, added Coggan.
Bel also announced that net sales grew 31 percent in the first quarter of 2014. “Year-over-year growth in Q1 was augmented by the continuing success of our acquisitions during 2013,” said Coggan.
The biggest growth driver among vertical segments this year for power products is expected to be the lighting market, although Coggan hopes the industrial market will turnaround this year, after being “relatively flat.” However, the premise wiring segment is still the largest market for Bel’s connector products.
Acquisitions also helped drive Bel’s 21.8 percent annual growth last year. In 2013, Bel acquired privately-held Array Connector Corp., a manufacturer of aerospace and mil-spec connector products, which expanded the product offerings of its Cinch Connector division, and TE Connectivity’s Transpower magnetics business (now called TRP Connector), which solidified Bel’s position in the integrated connector module (ICM) market.
The company has acquired six companies since 2012. “We have always been open about our willingness to grow the business through acquisition,” said Coggan.