Bosch makes offer to buy Extreme CCTV

Friday, February 1, 2008

STUTTGART, Germany--Robert Bosch GmbH, parent company of Bosch Security Systems, announced last week an offer to acquire Extreme CCTV for $5 a share, for a total purchase price of roughly $93 million. Bosch officials said Extreme, a developer and manufacturer of infrared illuminators and video surveillance products based in Vancouver, would expand the company's presence in North America and the UK, where Extreme operates Derwent Systems, a maker of infrared lighting systems, and Forward Vision CCTV.
The purchase price represents a premium of roughly 30 percent over Extreme's 30-day average share price and is more than three times Extreme's 2006 revenues, $27 million.
Jack Gin, Extreme's president and CEO, welcomed the deal. "There is a great synergy and complementary portfolio," he said. "Bosch has a diverse and widespread sales organization. We're already getting indications [of interest] from other parts of the world."
At the same time, Gin said there was little in the way of channel conflicts, which means the firm's distributors and integrators would still work directly with Extreme. "And over in England, our British team will remain intact and have a larger mandate," he said.
Dan Weiss, president and chief executive officer at Infrastruct Security, said he has used Extreme CCTV's products in a number of installations protecting petro-chemical facilities. "I hope they continue to represent the vertical that they're very good at, critical infrastructure," he said. "That's very important to us. I hope they continue to look for innovation and a competitive offering with their explosion-proof products. I would be disappointed if Bosch was just buying their channel, which I think they already have."
However, Weiss was positive about the potential for Bosch to improve Extreme's sales and distribution efforts. "Bosch, given their legacy, has always had a pretty consistent product offering and sales channel," he said. "Maybe they'll bring more structure to Extreme's product line."
The transaction is subject to approval by Extreme's shareholders and regulatory authorities. The deal should be formally concluded in the first quarter of 2008.