Company offers to buy Spokane based Itronix for $40 million

Sale to San Francisco group not expected to affect Spokane workers

John Stucke
Staff writer Spokesman Review

A San Francisco investment group has offered $40 million to buy Spokane-based computer maker Itronix Corp.

A sale has been anticipated for months as Itronix parent company Acterna Corp. attempts to reorganize and rebound from bankruptcy.

Itronix President Tom Turner said the sale to Golden Gate will not affect the company’s 325 Spokane employees.

"This is definitely good news for Itronix," Turner said. "We’ve been working toward this sale for many months. With it, Itronix will be an independent private company that will stay headquartered right here in Spokane."

Itronix makes rugged laptops, tough personal computers that can be dropped, exposed to moisture and otherwise abused without affecting performance. They are popular with the military and companies that need computers able to withstand the rigors of field work.

Acterna is primarily a telecom and wireless technology equipment company. One of its business segments specializes in communications equipment testing and competes with Agilent Technologies Inc.

Acterna’s business was hammered by the telecommunications slump. It failed to make an interest payment to a senior lender earlier this year and sought Chapter 11 bankruptcy protection.

The bankruptcy action dragged on Itronix, even though the company operated in the black last year. Itronix had sales of $140 million. Profits bested $1 million.

A new owner in good financial standing will allow Itronix to resolve bankruptcy-related issues with suppliers.

Golden Gate’s offer to pay $40 million cash and assume Itronix’s undisclosed liabilities may not be enough. Other suitors may offer more money for the company.

Turner expected a sale to be final in late September.

Itronix, originally a spinoff of Itron Corp., was purchased by Acterna for about $65 million six years ago. It has operations in Europe and is now trying to make inroads into the Middle East, Australia and other parts of the world.

Turner said operating under Golden Gate would help speed entry into those new markets.

Golden Gate targets growth businesses worth up to about $100 million. It has about $700 million in capital under management.

"Assuming all of this happens, we’re very excited that for the first time we will be able to stand alone as a company," Turner said. "This also means an encouraging outlook for job stability."

•Business writer John Stucke can be reached at (509) 459-5419 or at [email protected].

http://www.spokesmanreview.com/news-story.asp?date=082903&ID=s1401690&cat=section.business