Times Colonist

Carmanah sells marine lighting business, other assets to U.S. firm

- ANDREW A. DUFFY

Victoria’s Carmanah Technologi­es is selling its marine lighting business and other assets in a sale worth $77 million US.

The sale to North Carolinaba­sed SPX Corporatio­n represents just under half of the company, founded in 1996 by David Green to develop solarpower­ed marine lighting.

Chief executive John Simmons said the deal allows Carmanah to focus on its remaining assets.

“We had done a pretty good job over the last five years taking Carmanah’s original, but very narrow, slice of the marine aids to navigation marketplac­e, and beefing it up,” he said, noting their growth by acquisitio­n over the years establishe­d Caramanah’s marine business as a global leader. “Our ability to grow more in that segment was limiting out.”

Simmons said Carmanah was not going to be able to expand its product offering to take on the offshore oil and gas industry.

“It’s a very specialize­d next step and, quite frankly, would require an investment in time that was probably beyond our grasp,” he said. SPX becomes the largest player in that space.

“We’re happy to pass the baton to a company like SPX that can take the leadership position and, with its size and scope, can move into a market-dominant position,” he said.

The sale includes the entirety of Carmanah’s marine lighting business, an aviation obstructio­n lighting unit, an airfield lighting unit and some smaller support businesses. Those businesses brought in about $27 million US in revenue annually.

There are six Victoria staff from those units who will join SPX, which intends to open an office in the city when the deal is finalized next year.

“I’m delighted there’s no local employment loss,” Simmons said.

Carmanah’s board of directors has approved the sale, but shareholde­rs will have to vote on it in the new year.

The deal should net Carmanah about $73.5 million US, which is expected to result in the company having a cash balance of about $88.5 million US.

Simmons said company officials aren’t sure how that money will be spent, but they are considerin­g all options. Those include investment in the remaining business units, new acquisitio­ns and returning cash to shareholde­rs.

Simmons said there is a strong case to be made for investing in the remaining businesses: traffic-signalling devices, solar-powered lighting for streets and pathways, solar-powered asset-tracking devices, and safety and marking solutions for offshore wind farms. The businesses represent more than $33 million in revenue each year.

“Those four business platforms have great growth potential,” Simmons said. “And we now have more cash resources than we have ever had. We have the opportunit­y to look at those businesses and say: ‘What are we going to do next?’ ”

 ??  ?? Carmanah Technologi­es chief executive John Simmons: “We’re happy to pass the baton to a company like SPX that can take the leadership position and, with its size and scope, can move into a market dominant position.”
Carmanah Technologi­es chief executive John Simmons: “We’re happy to pass the baton to a company like SPX that can take the leadership position and, with its size and scope, can move into a market dominant position.”

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