Among other things, Iridian Spectral Technologies supplies custom narrowband optical filters for the Canada-based Dragonfly Telescope, which is investigating dark matter in the universe. Iridian is being purchased by the global industrial conglomerate IDEX Corp. [Image: Pieter van Dokkum / Courtesy of Iridian]
IDEX Corp., a conglomerate based in Northbrook, IL, USA, that provides specialty-engineered products for a wide variety of industry clients, announced on 26 April that it would acquire the Ottawa, Canada–based optical-thin-films maker Iridian Spectral Technologies. Total consideration in the deal is CAN$150 million (US$110 million), with an expected closing by the end of the 2023 second quarter.
Acquisition-fueled expansion
Born in the late 1970s and 1980s through not one but two leveraged buyouts, IDEX has expanded since then via more than a score of acquisitions (with a total value of over US$2.6 billion) of companies serving a broad swath of industrial sectors.
In the wake of that campaign, IDEX now runs what seems at first glance a dizzying array of operations. Those diverse businesses are organized into three segments: Fluid and Metering Technologies, Health and Science Technologies, and Fire and Safety/Diversified Products. Across those segments, IDEX’s offerings range from fluid pumps, microfluidic systems and sealants to optical components and coatings to the “Jaws of Life” system used to rescue trapped motorists after an accident.
Over the past dozen years, IDEX has built its operations in optics and photonics. The drive started in earnest in 2011, when it purchased the laser and photonic components manufacturer CVI Melles Griot for some US$400 million. IDEX’s products for the photonics sector today come out of three business units, providing advanced thin films, infrared optical components and laser optics—bundled as IDEX Optical Technologies, a unit of its Health and Science Technologies segment. The company also markets optical filters to life-sciences instrument makers through the Semrock brand, picked up by IDEX in a 2008 acquisition.
Adding to optical-filter expertise
Iridian, IDEX’s latest acquired firm, designs and manufactures thin-film, multilayer optical filters for laser communications, telecom and life-science customers. IDEX hopes that the acquired firm will mesh well with the existing Semrock operation, and also open up new opportunities by adding to the parent company’s technology base in filter development.
[Image: Courtesy of Iridian]
In a press release announcing the deal, IDEX CEO and president Eric Ashleman maintained that the Iridian purchase “strongly supports” the IDEX strategic growth plan. “It expands our talent, technology and product portfolio in optical filters, enabling us to better compete in our core markets, and expand into new markets that we believe will drive profitable growth.”
Rough near-term waters
In a separate release on 26 April, IDEX reported financial results for the first quarter of calendar 2023. The company said it had achieved record sales of US$845 million, up 13% year to year (driven by both acquisitions and organic growth), with earnings per share mostly flat. The company also suggested, however, that its Health and Science Technologies segment in particular had run into some rough near-term waters, owing to excess inventory relative to customer demand. The company thus looks for a substantial “inventory correction” in the months ahead, and has nudged down its projections for sales and earnings for 2023 as a whole.
Even so, the firm’s earnings release stressed that the markets for its health and science business “have strong fundamental secular growth trends.” Further, IDEX maintains that the acquisition of Iridian—described as a “highly strategic asset”—will bring “capabilities that expand our optical filters portfolio serving the space, life science and telecommunications markets.”