Han’s Laser’s Acquisition of Nextec
LOCATION OF TARGET
Israel
DRP ROLE
Advisor to the buyer
STAKE ACQUIRED
80% with option to acquire remaining 20%
Han’s Laser’s Acquisition of Nextec
LOCATION OF TARGET
Israel
DRP ROLE
Advisor to the buyer
STAKE ACQUIRED
80% with option to acquire remaining 20%
About the parties
Han’s Laser Technology Industry Group Co. Ltd. is the largest laser equipment company in Asia and one of the top laser companies in the world. Headquartered in Shenzhen and publicly listed on the Shenzhen Stock Exchange, it is one of China’s leading advanced machinery equipment companies and a key supplier to Apple and other major global companies.
Nextec Technologies 2001 Ltd. is a high-tech company based in Israel specializing in laser scanning, measurement and quality control inspection. The company has developed a unique 3D laser inspection system that is more accurate and five times faster than traditional CMM inspection devices. Nextec’s customers are primarily in the automotive and aerospace sectors including Rolls Royce, GE, Volkswagen, FAW and others.
Rationale
Han’s Laser had achieved great success by leveraging its manufacturing platform in Shenzhen and its large salesforce throughout China while investing in R&D and acquisitions to expand its product portfolio. In 2011, it began sales of laser inspection devices and its Measurement and Micromachining Department became one of the company’s fastest growing business divisions. Nextec’s advanced laser inspection equipment was a good fit for the new department. The acquisition could also bring other added benefits such as increasing the company’s limited international presence, and helping the company expand its sales in the auto and aerospace sectors – two areas Han’s Laser had identified as priorities for future growth.
Nextec had recently signed its first major sales contract in China and recognized that it had many other opportunities in China but that they would be very difficult to realize without support from a strong local player in the China market.
Deal highlights
- Han’s Laser second overseas acquisition; the first in Israel and first with support from a buy-side financial advisor.
- One of the first strategic M&A transactions between Chinese and Israeli industrial companies.
- The deal enabled Han’s Laser to increase its presence in the high growth laser inspection sector.
- Innovative 80:20 deal structure with call and put options exchanged between the buyer and seller giving Nextec’s founder CEO a strong incentive to continue growing the business and allowing both sides a path to a 100% sale.
- Post-acquisition, Han’s Laser made no changes to the Nextec team, brand or operations in Israel, and assisted Nextec to build a presence in China and to leverage Han Laser’s resources in the China market.
How did DRP add value?
- DRP introduced the acquisition opportunity to Han’s Laser and accompanied Han’s on two trips to Israel for negotiations and due diligence.
- DRP arranged local support in Israel for Han’s Laser, including legal counsel, local regulators and other advisors.
- DRP led communications with Nextec on behalf of Han’s Laser and played a leading role on all aspects of the negotiations, including the acquisition structure and price.
- DRP played a critical intermediary role throughout the process to address concerns on both sides and to achieve as successful transaction for Han’s Laser.
About the parties
Han’s Laser Technology Industry Group Co. Ltd. is the largest laser equipment company in Asia and one of the top laser companies in the world. Headquartered in Shenzhen and publicly listed on the Shenzhen Stock Exchange, it is one of China’s leading advanced machinery equipment companies and a key supplier to Apple and other major global companies.
Nextec Technologies 2001 Ltd. is a high-tech company based in Israel specializing in laser scanning, measurement and quality control inspection. The company has developed a unique 3D laser inspection system that is more accurate and five times faster than traditional CMM inspection devices. Nextec’s customers are primarily in the automotive and aerospace sectors including Rolls Royce, GE, Volkswagen, FAW and others.
Rationale
Han’s Laser had achieved great success by leveraging its manufacturing platform in Shenzhen and its large salesforce throughout China while investing in R&D and acquisitions to expand its product portfolio. In 2011, it began sales of laser inspection devices and its Measurement and Micromachining Department became one of the company’s fastest growing business divisions. Nextec’s advanced laser inspection equipment was a good fit for the new department. The acquisition could also bring other added benefits such as increasing the company’s limited international presence, and helping the company expand its sales in the auto and aerospace sectors – two areas Han’s Laser had identified as priorities for future growth.
Nextec had recently signed its first major sales contract in China and recognized that it had many other opportunities in China but that they would be very difficult to realize without support from a strong local player in the China market.
Deal highlights
- Han’s Laser second overseas acquisition; the first in Israel and first with support from a buy-side financial advisor.
- One of the first strategic M&A transactions between Chinese and Israeli industrial companies.
- The deal enabled Han’s Laser to increase its presence in the high growth laser inspection sector.
- Innovative 80:20 deal structure with call and put options exchanged between the buyer and seller giving Nextec’s founder CEO a strong incentive to continue growing the business and allowing both sides a path to a 100% sale.
- Post-acquisition, Han’s Laser made no changes to the Nextec team, brand or operations in Israel, and assisted Nextec to build a presence in China and to leverage Han Laser’s resources in the China market.
How did DRP add value?
- DRP introduced the acquisition opportunity to Han’s Laser and accompanied Han’s on two trips to Israel for negotiations and due diligence.
- DRP arranged local support in Israel for Han’s Laser, including legal counsel, local regulators and other advisors.
- DRP led communications with Nextec on behalf of Han’s Laser and played a leading role on all aspects of the negotiations, including the acquisition structure and price.
- DRP played a critical intermediary role throughout the process to address concerns on both sides and to achieve as successful transaction for Han’s Laser.
TESTIMONIALS
What our clients and partners say about us
“Bob and his team have a deep understanding of Chinese companies and international markets. They did an excellent job supporting our Measurement & Micromachining Department on the acquisition of Nextec.”
“DRP Capital introduced an excellent target company for us that we had not heard of before, but it was a very good fit for our business. Bob and his team played a critical role in the negotiations and acted as a bridge between our team and Nextec. We are very pleased with the acquisition of Nextec and the services of DRP Capital.”
Joining Han’s Laser Group, a great strategic partner, was a unique opportunity for Nextec. This transaction couldn’t have happened without the fully active and professional leadership of DRP Capital.”
TESTIMONIALS
What our clients and partners say about us
“Bob and his team have a deep understanding of Chinese companies and international markets. They did an excellent job supporting our Measurement & Micromachining Department on the acquisition of Nextec.”
“DRP Capital introduced an excellent target company for us that we had not heard of before, but it was a very good fit for our business. Bob and his team played a critical role in the negotiations and acted as a bridge between our team and Nextec. We are very pleased with the acquisition of Nextec and the services of DRP Capital.”
Joining Han’s Laser Group, a great strategic partner, was a unique opportunity for Nextec. This transaction couldn’t have happened without the fully active and professional leadership of DRP Capital.”