Cray Electronic Holdings Plc looks to have won the Dutch auction – that’s one where the seller states a price and then comes down until someone is prepared to bite – for the information technology arm, principally the old Case Communications company, of TI Group Plc’s Dowty Group acquisition. The price is thought to be […]
Cray Electronic Holdings Plc looks to have won the Dutch auction – that’s one where the seller states a price and then comes down until someone is prepared to bite – for the information technology arm, principally the old Case Communications company, of TI Group Plc’s Dowty Group acquisition. The price is thought to be between ?50m and ?55m, excluding ?10m of property, and the Cognito two-way paging business, in which Dowty had invested ?30m according to the Evening Standard. The division has annual sales of ?125m, representing a major expansion for Cray – but where with Dowty, it was built from scratch as a third leg to its business, it is at the heart of one of the two areas in which Cray is specialising under its new management – data communications and software. Dowty bought Case for ?82.5m in shares and cash in 1988, but it had already paid $49m for Cherry Hill, New Jersey-based T-1 multiplexer specialist Datatel Inc, and ?1.2m on a modem manufacturer the previous year. In retrospect, the acquisition should look like a bargain for Cray, but in the present climate, it will likely be seen to be paying a full price. It has put back announcement of its year-end figures until Friday to prepare institutional shareholders for the news.
