Data I/O to buy V-TEK and A&J for $23M in bid to nearly double revenue
What's the deal? Data I/O CorporationDealroom has a profile for this one. Try Dealroom → (NASDAQ: DAIO), a Redmond, Washington-based provider of semiconductor programming and security provisioning solutions, has signed a definitive agreement to acquire V-TEKDealroom has a profile for this one. Try Dealroom → and A&J Programming for roughly $23 million in cash and stock. The deal is expected to close this week, subject to customary closing conditions.
What each side brings: V-TEK, based in Mankato, Minnesota, makes semiconductor handling and packaging equipment. A&J Programming, of San Jose, California, provides device programming services. Data I/O programs microcontrollers, security integrated circuits, and memory devices for automotive, industrial, medical, and Internet of Things applications.
The terms: About $3 million of the price will be paid in roughly 1.12 million Data I/O shares, with the rest in cash. The company plans to fund the purchase through existing cash, new shares, and proceeds from a recently announced proposed $13.25 million securities offering.
What's the endgame? Data I/O said the acquisition could nearly double annual revenue and be accretive to earnings and cash flow. The combination would stretch its reach across semiconductor preparation — from programming and security provisioning to handling and packaging.
Why now? The deal follows a financing-led reset. Data I/O raised $9 million in May and reported second-quarter revenue of $5.2 million, up 59% sequentially but below the year-earlier quarter.
What could go wrong? The company has not disclosed expected revenue contributions, cost savings, or integration plans for either business. With most of the price relying on cash and new securities, the deal adds dilution and financing-cost risks to an already demanding integration.
The signal: For a company of Data I/O's size, a near-doubling of revenue through acquisition is a notable bet rather than a routine bolt-on. Its success rests on whether the two businesses deliver the promised scale and cash — not on any broader wave of sector consolidation.
Read more: citybiz.co
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