Wegener and Sencore, a provider of digital TV operational and test and measurement equipment, announced Tuesday they have entered into a non-binding agreement regarding Sencore's possible acquisition of Wegener for a proposed purchase price of $6 million in cash.
"Sencore is a quality organization that we will be pleased to join," Wegener chairman and CEO Robert Placek said in a statement. "The combination of Sencore and Wegener Corporation should provide our customers continued access to innovative products and the exceptional support they have come to expect from Wegener."
Privately held Sencore, based in Sioux Falls, S.D., provides signal monitoring and analysis and video/audio distribution equipment to broadcasters, satellite and cable operators and telcos.
Duluth, Ga.-based Wegener provides digital video and audio solutions to cable operators, TV and radio broadcasters, telco operators and programmers. Customers include Big Ten Network, Fox's cable and broadcast networks, HDNet and ION Media. Its product line includes iPump media servers for file-based and live broadcasts, and satellite media receivers for live radio and video broadcasts.
For its fiscal year ended Aug. 29, 2008, Wegener reported revenue of $21.5 million and net income of $383,000.
The companies said the purchase price assumes that Wegener will have "an appropriate amount of working capital" as of the closing date of the acquisition, and that the acquisition price would be adjusted accordingly for any anticipated variances in the actual amount of its working capital.
As part of the letter of intent, Wegener has made a binding commitment to negotiate exclusively with Sencore for a period of 60 days and will have to pay certain termination fees under certain circumstances.