"The core business of both our companies is proprietary sensor technologies," explained Robert Mehrabian, Executive Chairman of Teledyne. "Our business models are also similar: we each supply sensors, cameras and sensor systems to our customers. However, our technologies and products are complementary with minimal overlap because our image sensors are based on different semiconductor technologies for different wavelengths." Jim Cannon, President and Chief Executive Officer of Flir, added: "Together we will offer a uniquely complementary end-to-end portfolio of sensor technologies for all major fields and applications with a balanced global customer base."

The transaction, which has been approved by the boards of directors of both companies, is expected to close in mid-2021, subject to required regulatory approvals, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, approval by Teledyne and Flir shareholders and other customary closing conditions.

Under the terms of the agreement, Flir shareholders will receive $28.00 per share in cash and 0.0718 shares of Teledyne common stock for each Flir share, for a total purchase price of $56.00 per Flir share, based on Teledyne's 5-day volume weighted average share price as of December 31, 2020. The transaction represents a 40% premium to Flir shareholders based on Flir's 30-day volume weighted average share price as of December 31, 2020.

As part of the transaction, Teledyne has agreed to a 364-day USD 4.5 billion credit facility to finance the transaction and refinance existing debt. Teledyne expects to secure the transaction with permanent pre-closing financing. Net leverage is expected to be approximately 4.0x of pro forma adjusted EBITDA at closing, with leverage expected to decline to less than 3.0x by the end of 2022.

Teledyne expects the acquisition to be immediately accretive to earnings, excluding transaction costs and amortization of intangible assets, and accretive to GAAP earnings in the first full calendar year following the acquisition.

The Teledyne Group includes measurement technology manufacturer LeCroy, image processors Dalsa and Lumenera, and image processing and semiconductor manufacturer e2v.