In Q1, Specialty Gas Report (SGR) explained how the pace of development in the technology market is driving innovation - and in turn revenue growth - for equipment providers.
No instrument manufacturer can afford to become complacent. With technology in the market changing very rapidly, and customers expecting a frequently updated and improved offering from their suppliers, the onus is on the equipment company to stay ahead of the curve.
MOCON Inc. is doing exactly that. After announcing its intention to acquire fellow equipment manufacturer PBI-Dansensor in March, an agreement was finalized in April and MOCON had captured its competitor in a deal worth around $20 million.
The deal completed a long-term objective for the Minneapolis-based company, concluding an interest that MOCON had held for more than 10 years, SGR understands. It also brought together a combined 2011 revenue base of $56.7 million.
But for MOCON it means much more than that. Described as an excellent fit, the acquisition allows the company to stay firmly at the forefront of the instrumentation market; synergistic operations and product lines mean that MOCON is now capable of offering customers more gas testing instrumentation than ever before.
MOCON president and CEO Robert Demorest explained to SGR, “MOCON, Inc. is very pleased to have made this acquisition. There is excellent synergy between the two companies. For example, we have a significant overlapping customer base. Also, the acquisition has enabled us to add testing equipment categories that we didn’t previously have.”
With the two companies both involved in the MAP (modified atmosphere packaging) market, the takeover creates a strong competitor in the MAP equipment business - and added product capabilities for the customer.
Demorest said, “We are very excited about PBI-Dansensor’s 20-plus year leadership position in modified atmosphere package (MAP) testing equipment. The acquisition gives us an opportunity to join forces and consolidate product lines.”
“We view it as a perfect marriage of two companies who are market leaders in most of the categories they represent.”
“Just to give a few examples, the acquisition has enabled us to add gas mixers and additional online and offline headspace analyzers to our product portfolio which MOCON didn’t previously have,” he continued. “Our product line now goes from creating the gas mixture to analyzing, validating, verifying and checking the package for seal integrity.”
With PBI-Dansensor’s established international distributor channels, many of MOCON’s new products can now ‘flow’ to major markets around the world without the necessity of setting up new distribution networks.
Such a boost comes at a great time for MOCON. The company saw international sales grow in its Q1 operating results for the period ended March 31, 2012, with international sales accounting for 61 percent of total consolidated sales compared to 57 percent in the same quarter last year.
With PBI-Dansensor now on board, MOCON is positioned to take advantage of even more opportunities overseas.
“We are also able to take advantage of each other’s sales and service channels,” Demorest commented. “We are taking a look at which company’s ‘go to market’ channels work the best, country by country. This will enable us to construct the best possible sales and customer support network. It will be a win-win for both the company and for our customers.”
Win-win for the customer is the message Demorest leaves us with, as he describes the opportunities ahead both for MOCON and its clients around the world.
“In this immediate post-acquisition period, both entities have been able to identify capabilities within the other company that we didn’t know existed,” he says.
“These capabilities will lead to creating significant new market opportunities. We look forward to sharing these with our customers as they are further developed.”
“The acquisition,” he continues, “means that we will now be able to offer our global client base even more gas testing instrumentation than ever before.”