908 Devices expands with acquisition of RedWave

BOSTON – 908 Devices Inc. (Nasdaq: MASS), known for its professional analytical equipment, has completed the acquisition of RedWave Technology, a company known for its portable FTIR spectrum analyzers. The acquisition announced today will enhance 908 Devices' portfolio of chemical analysis equipment used in various fields including forensics and industrial quality control.

The deal, which closed on Monday, involves an initial payment of $53.5 million, including $45 million in cash and 1.5 million shares of common stock. In addition, the agreement includes contingent consideration of up to 4 million shares, subject to the achievement of certain revenue and product booking milestones over the next two years.

Founded in 2016 and headquartered in Danbury, Connecticut, RedWave Technology operates globally with more than 700 portable analyzers in more than 20 countries.

The company has demonstrated a strong financial position, with revenue growing 20% ​​to $13.7 million in 2023, and gross and operating margins also being impressive. RedWave is expected to contribute $11 million in revenue to 908 Devices in 2024, eight months after acquisition.

908 Devices CEO and co-founder Kevin J. Knopp expressed enthusiasm for the acquisition, emphasizing the complementarity of the two companies' technologies. Jon Frattaroli, CEO of RedWave Technology and now vice president of strategy at 908 Devices, echoed the sentiment, emphasizing a shared commitment to innovation and customer service.

The acquisition is designed to enhance 908 Devices' offerings in the point-of-care chemical analysis market, providing first responders and security personnel with tools to quickly identify chemical threats.

Perella Weinberg Partners LP and Goodwin Procter LLP provided financial advisory services to 908 Devices on this transaction, and Diamond Capital Advisors and Benesch, Friedlander, Coplan & Aronoff LLP provided financial advisory services to RedWave Technology.

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More details about the acquisition will be discussed during today's conference call in conjunction with 908 Devices' first quarter 2024 financial results.

The information in this article is based on press release statements.

Investment Professional Insights

As 908 Devices Inc. (NASDAQ: MASS ) expands its portfolio with the strategic acquisition of RedWave Technology, financial metrics and analyst insights have become critical for investors to assess the company's current position and future prospects. The latest data from InvestingPro reveals several key indicators:

  • The company's market capitalization is $189.82 million, reflecting its post-acquisition market position.
  • The company's price-to-earnings (P/E) ratio is -5.16, and its adjusted P/E ratio for the trailing twelve months ended in the fourth quarter of 2023 was -5.22. The company's earnings are currently unable to support its stock price, which may be a Worrying questions for value-oriented investors.
  • Revenue growth for the trailing 12 months to the fourth quarter of 2023 was 7.21%, indicating modest sales growth and possible synergies with newly acquired RedWave Technology's products.

between Investment Professional Tips For 908 Devices, it's worth noting that the company holds more cash than debt on its balance sheet, which is a positive sign for financial stability and operational flexibility. Additionally, the company has a high shareholder yield, which may be attractive to investors looking for return in the form of dividends, especially since the company doesn't pay a dividend.

However, investors must take into account that analysts do not expect 908 Devices to be profitable this year, with net profits expected to decline. These factors, coupled with the stock's poor performance in the latest month, with a total price return of -23.77%, may influence investment decisions.

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For those interested in a more in-depth analysis, there is additional content Investment Professional Tips is available, which provides further insight into 908 Devices' financial health and market potential.To explore these insights and make smarter investing decisions, consider using the coupon code PRONEWS24 Get an additional 10% discount on annual or two-year Pro and Pro+ subscriptions at InvestingPro.

This article was generated with the support of artificial intelligence and reviewed by an editor. For more information, please see our terms and conditions.

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