Ithaca laser-technology company Binoptics is being bought by M/A-Com Technology Solutions of Lowell, Mass., for $230 million in cash, the company announced Wednesday.
Binoptics, in business since 2000 using technology developed at Cornell University, develops and makes semicondutor microchip lasers for equipment in the data and telecommunications industries that use light energy rather than electricity.
It has about 143 employees and plans an expansion of its 30,000-square foot facility on Brown Road in the Cornell Business and Technology Park near the Ithaca-Tompkins Regional Airport.
Tompkins County economic-development officials said an acquisition was expected and have received no indication the expansion won’t happen and that Binoptics will stay.
On Thursday, Binoptics founder and CEO Alex Behfar confirmed that, describing the deal as M/A-Com acquiring a new product line.
“This is an acquisition where it’s not consolidation,” he said.
The privately held company has been financed by an array of investment companies from Silicon Valley and elsewhere, including the Cayuga Venture Fund of Ithaca and Onondaga Venture Capital Fund of Syracuse.
M/A-Com’s top executive said Binoptics will help broaden his company’s product line as it grows through mergers and acquisitions.
“We believe BinOptics’ wafer-scale model for indium phosphide lasers will play perfectly to our strength in compound semiconductor manufacturing, allowing us to quickly address what is currently a supply-constrained part of the optical component industry,” President and CEO John Croteau said in a press release.
Ma/Com expects to fund the purchase with cash on hand and debt from $100 million in revolving credit. After a regulatory waiting period, it expects to close the sale in its first quarter of 2015.
Ma/Com was founded in 1950 as Microwave Associates and one of its first products was used in radar. It supplies analog radio-frequency, microwave and laser products for products such as global positioning systems, radio communications, defense and civilian air traffic radar, the cellular industry, WiFi gear, and cable television and broadband Internet. The company reported fiscal-year revenue of $418.7 million, up form $323 million in 2013. Croteau predicted double-digit revenue growth in fiscal 2015.
It has about 700 employees, according to Heather Filiberto, vice president and director of economic development services for Tompkins County Area Development.
Binoptics recently got approval from the Tompkins County Industrial Development Agency for sales and property tax abatements for about 2,500 square feet for a new clean room. It also plans to lease more space in the business park. There is no indication the expansion will not go forward, according to Michael Stamm, president of TCAD, which provides support for the IDA.
Behfar confirmed that, as well.
Stamm said the purchase is good news because it provides access to capital for the company to grow and continue to employ local residents.
It’s a similar path taken by several other Ithaca-grown technology companies in growing then being acquired by bigger companies but kept operating in Ithaca, including micro-gyroscope maker Kionix, spectrometry company Advion, and access-control and food-service software company CBORD.
It’s also a natural result in the venture-capital process, Behfar said, and M/A-Com was a good fit for employees and customers.
“With any venture capital-funded company there eventually has to be an exit so investors can recoup some of their investment and make some money, so there is a natural time that this will come. This was the right time, the right partner.”