Vancouver-based industrial laser manufacturer nLIGHT announced Thursday that it has acquired fellow high-energy laser maker Nutronics Inc. in a $33.3 million deal.
Nutronics develops combined lasers and beam control systems for use in high-energy laser systems sold to defense markets.
“The acquisition of Nutronics complements nLIGHT’s current directed energy offerings, opening a significantly larger portion of the technology value stack in this attractive growth market,” said nLIGHT CEO Scott Keeney. “With the addition of Nutronics, nLIGHT will offer customers a broad range of directed energy products, from semiconductor lasers through beam control. Nutronics brings to nLIGHT a deep engineering team with demonstrated success in developing directed energy technologies.”
The acquisition represents another step in nLIGHT’s ongoing push into the directed energy segment of the aerospace and defense market. The company’s core business is semiconductor and fiber lasers for industrial applications such as cutting, welding and microfabrication, but it has also been pursuing development of directed energy products for defense applications. Nutronics’ beam combination and control expertise will help advance the development of that segment, according to a press release from nLIGHT.
The aerospace and defense segment comprised about 26 percent of nLIGHT’s overall revenue in the third quarter, according to financial results posted last week. It was also a bright spot in a quarter where the company encountered a slowdown in other markets, such as microfabrication.
In a Nov. 4 conference call with investors, Keeney placed a strong emphasis on the growth potential of directed energy applications in the defense market. Those uses are currently only a small percentage of the company’s sales, he said, but he expects more customers to begin utilizing lasers for defense applications in the next two to five years.
The most prominent current example of a directed energy defense application is the U.S. Navy’s HELIOS program, which is scheduled to equip warships with laser weapons to attack enemy boats and drones starting in 2021. Lockheed Martin holds the contract to build the first two HELIOS systems, and nLIGHT is subcontracted to supply some of the components, according to company spokesman Jason Willey.
Nutronics is based in Longmont, Colo., and currently employs 32 full-time staff, all of whom will be retained after the merger. nLIGHT will continue to operate the Colorado facility and plans to expand the Nutronics team in the coming year, Willey said.
“Joining the nLIGHT team will enable Nutronics to accelerate our ongoing work in supporting HEL (high-energy laser) development and better positions the company to execute on our recent contract awards,” said Nutronics CEO Jeff Barchers. “The potential for collaboration between the Nutronics and nLIGHT teams, and our shared vision of the market opportunity, will create significant value for our customers and the directed energy market as a whole.”
The $33.3 million acquisition consisted of $17.5 million in cash and $15.8 million of restricted stock units, funded through cash on nLIGHT’s balance sheet. The merger is expected to add between $25 million to $40 million to nLIGHT’s 2020 revenues, the company announced.
nLIGHT also announced that its board of directors had authorized the company to repurchase up to $10 million of its stock, with the intention of offsetting restricted stock unit grants awarded in connection with the transaction.
nLIGHT trades on the Nasdaq under the symbol LASR. The company’s stock jumped upward by 18.3 percent on Friday morning, climbing above $20 per share by around 11 a.m. local time.
