Monday, February 2, 2015
Advanced Photonix (API), to merge with Luna Innovations Incorporated (LUNA)
ROANOKE, Va.--(BUSINESS WIRE)--
Luna Innovations Incorporated (LUNA), which develops and manufactures fiber optic sensing and test & measurement products for the telecommunications, aerospace, automotive, energy, and defense markets and Advanced Photonix, Inc. (NYSE MKT: API), a leading supplier of optoelectronic sensors, devices, and instrumentation for the telecommunications, defense, medical, and industrial markets today announced their agreement to merge.
The combined company, which will keep the Luna name and be headquartered in Roanoke, Va., will provide greater capability across a broader market base, with a strong balance sheet and potential operating synergies. The merged company will have pro forma combined revenue for the 12 months ended September 30, 2014 of approximately $49.9 million, compared to Luna’s historical revenues of $20.0 million for the 12 months ended September 30, 2014. Combined with the cost savings from only a single public company infrastructure, Luna will thus be fundamentally better positioned for improved profitability. The combined company will have significant intellectual property protection for the many technologies in its combined product portfolio, with over 200 patents and patent applications.
The combined company will have a strong foundation from Luna’s core test & measurement products and API’s High Speed Optical Receiver (HSOR) and Optosolutions product lines, enabling continued investment in the growth of areas such as Luna’s strain & temperature sensing business and API’s next generation of receivers and detectors.
Additionally, the combined company plans to continue developing a pipeline of technologies for future commercialization in Luna’s Technology Development Division and API’s Terahertz operations.
“This merger will enable us to provide even greater capability across a broadened market base, providing improved opportunity for growth,” said Luna President and CEO My Chung. “Joining forces with a company like API will help us accelerate our path to profitability.”
“We look forward to working with Luna to create a dynamic company with greater potential,” said Donald Pastor, Chairman of the Board for API. “We are very proud of the technology, products and markets that we’ve developed at API, and are excited at the prospect of what we may be able to do together with the talented team at Luna.”
Richard Kurtz, CEO of API, added, “The merger of our two companies provides significant opportunity for growth. The combined product lines will strengthen the merged company’s position in the marketplace by offering more for each customer.”
“We’re creating a significantly stronger company by combining Luna’s proven technology with API’s components and subsystems,” stated Richard Roedel, Luna’s Chairman of the Board.
At the closing of the merger, API stockholders will receive shares of Luna common stock at a ratio of 0.31782 shares of Luna common stock for each share of API common stock owned by them. Luna will be filing a Registration Statement on Form S-4, containing a joint proxy statement/prospectus, with the SEC. Following the effectiveness of the registration statement and after mailing the joint proxy statement/prospectus to current stockholders, API and Luna will each hold stockholder meetings for approval of the merger and related matters.
My E. Chung will continue as CEO of the combined company and a member of the board of directors. The board of directors will be expanded to seven seats and will be composed of three directors designated by Luna’s board of directors, who will include Richard W. Roedel as chairman, John B. Williamson III and Michael W. Wise, and three directors designated by API’s board of directors, who will include Donald Pastor, Gary J. Spiegel and Ed J. Coringrato Jr.
My Chung and Dale Messick, Luna’s Chief Financial Officer, along with Rick Kurtz, API’s CEO and Rob Risser, API’s COO will host a conference call with investors on Tuesday, February 3, 2015 at 9:00 a.m. (EST) to discuss the transaction. The conference call will be available via live webcast on the Luna website at www.lunainc.com under the tab “Investor Relations.” To participate by telephone, the domestic dial-in number is 877.546.5020 and the international dial-in number is 857.244.7552. The participant access code is 13673034. Investors are advised to dial in at least five minutes prior to the call to register. The webcast will be archived on Luna’s and API’s respective websites under “Webcasts and Presentations” for 30 days following the conference call.