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(Reuters) -Industrial tools maker AMETEK will acquire FARO Technologies at an enterprise value of about $920 million, the two companies said on Tuesday, sending the target firm's shares soaring 36% before the bell.
Under the agreement, AMETEK is offering $44 per share in cash, representing about a 40% premium to FARO's last close. The equity valuation pegs FARO's market value at $846 million.
The acquisition is expected to be completed in the second half of the year.
FARO Technologies, which produces 3D measurement and imaging solutions including portable measurement arms, laser scanners and trackers, among others, generated about $340 million in sales in 2024.
The transaction will boost AMETEK's precision technology portfolio in the electronic instruments division, which produces test and measurement instruments for sectors such as aerospace, medical, research, power and industrial markets.
FARO's shares rose to $42.8 a piece in premarket trading, while AMETEK shares were flat.
AMETEK last week beat Wall Street estimates for first-quarter profit on the back of higher margins across segments, even as the company navigated inflationary pressures in the U.S. and tariff-led market uncertainty.
"We are finding opportunities created by the tariffs to take advantage of our substantial U.S. manufacturing footprint to broaden our customer base and support their growth in the U.S.," CEO David Zapico said on Thursday.
(Reporting by Aatreyee Dasgupta and Sameer Manekar in Bengaluru; Editing by Tasim Zahid and Shreya Biswas)