OSI Systems to acquire explosive trace detection business from Smiths Group for $75.5M

OSI Systems last week announced that it has entered into an agreement to acquire the global explosive trace detection (ETD) business from Smiths Group for $75.5 million in cash.

The ETD business, headquartered in Andover, Mass., was acquired by Smiths in April of this year as a part of its acquisition of Morpho Detection. The business currently has a worldwide installed base of approximately 11,000 units.

According to a statement, the acquisition will bolster OSI’s strategy to expand its security product offerings, which the company got a jump start on with its purchase last year of X-ray inspection systems provider American Science and Engineering (AS&E).

“The acquisition of this ETD business is highly complementary to our current operations and this natural fit will enable us to better serve the unique needs of our customers seeking to secure airports, borders, public venues, and critical infrastructure. This acquisition fills a gap in our aviation checkpoint offering that currently includes passenger screening, carry-on baggage inspection, and automated tray return solutions,” said OSI Systems Chairman and CEO Deepak Chopra.

The company expects to fund the acquisition with a combination of balance sheet cash and borrowings from its existing $525 million credit facility.