GE pursues an IFS deal

Tuesday, April 1, 2003

NEWTOWN, Conn. - International Fiber Systems is the latest company being courted by General Electric in its quest to expand its competencies in the security market.

Company officials at GE confirmed it filed papers with federal regulators to purchase IFS, a manufacturer of fiber optic technology-based products, such as data transceivers, multiplexers and audio and video transmission systems. The proposed purchase price was not released.

“We don’t have any visibility into when the deal will close,” said Jay Pinkert, spokesman for GE Interlogix. “It’s still subject to government approval and customary conditions.”

If approved by regulators, privately held IFS will become one in a series of companies to join GE’s ranks since it entered the security market early last year. Its most recent purchase happened at the end of November 2002 when it bought access control company InfoGraphic Systems.

Richard Malstrom, vice president of IFS, said the company has experienced “double digit growth the last five to seven years” as the demand for fiber-based transmission systems increased.

Malstrom said it was premature to speculate on how IFS could benefit by joining up with GE. “We value our customers and we believe the combination of GE and IFS will give us a stronger value equation for all of our customers,” he said.

In the meantime, he said IFS will continue to operate as a separate company until and if the transaction closes.

Analysts have said that GE is known for its deep pockets and is willing to invest heavily in markets that it enters to become the top player. Marking its entrance into the security industry, the company gained a large chunk of market share with its purchase of Interlogix, a holding company made up of more than a handful of security companies, such as ITI, Kalatel, Casi Rusco, Sentrol, Fiber Options and Caddx.

It recently announced the reallocation of some manufacturing work, and the combining of Fiber Options with GE Interlogix’s camera brand, Kalatel in Corvallis, Ore. More than 50 people at Fiber Options headquarters in Bohemia, N.Y. were laid off by the middle of February.