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    Teradyne Discussion

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    Teradyne announced in August 2001 that it would acquire GenRad, with each GenRad share converted to 0.1733 Teradyne shares. Teradyne expected the acquisition would initially lower earnings but would become profitable in 2002 through synergies and increased demand. However, by September 2001 the US economy deteriorated due to the post-9/11 recession. The board had to decide if this was the right time for the complex integration or if the economy would recover for the transaction to be earnings-accretive as planned. The merger made strategic sense by combining strengths in test and measurement, positioning Teradyne for stronger global growth through an expanded product portfolio. Both companies had reputations for integrity and innovation, so cultural

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    Teradyne Discussion

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    Teradyne announced in August 2001 that it would acquire GenRad, with each GenRad share converted to 0.1733 Teradyne shares. Teradyne expected the acquisition would initially lower earnings but would become profitable in 2002 through synergies and increased demand. However, by September 2001 the US economy deteriorated due to the post-9/11 recession. The board had to decide if this was the right time for the complex integration or if the economy would recover for the transaction to be earnings-accretive as planned. The merger made strategic sense by combining strengths in test and measurement, positioning Teradyne for stronger global growth through an expanded product portfolio. Both companies had reputations for integrity and innovation, so cultural

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    Teradyne announced in August 2001 that it would acquire GenRad, with each GenRad share converted to 0.1733 Teradyne shares. Teradyne expected the acquisition would initially lower earnings but would become profitable in 2002 through synergies and increased demand. However, by September 2001 the US economy deteriorated due to the post-9/11 recession. The board had to decide if this was the right time for the complex integration or if the economy would recover for the transaction to be earnings-accretive as planned. The merger made strategic sense by combining strengths in test and measurement, positioning Teradyne for stronger global growth through an expanded product portfolio. Both companies had reputations for integrity and innovation, so cultural

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    16 views1 page

    Teradyne Discussion

    Uploaded by

    E learning
    Teradyne announced in August 2001 that it would acquire GenRad, with each GenRad share converted to 0.1733 Teradyne shares. Teradyne expected the acquisition would initially lower earnings but would become profitable in 2002 through synergies and increased demand. However, by September 2001 the US economy deteriorated due to the post-9/11 recession. The board had to decide if this was the right time for the complex integration or if the economy would recover for the transaction to be earnings-accretive as planned. The merger made strategic sense by combining strengths in test and measurement, positioning Teradyne for stronger global growth through an expanded product portfolio. Both companies had reputations for integrity and innovation, so cultural

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    Teradyne

    On August 2nd, 2001, Teradyne, Inc (NYSE: TER) of Westford, Massachusetts announced
    that it would be acquiring GenRad, Inc (NYSE: GEN), a leading manufacturer of automatic
    test equipment and related software. Under the terms of the definitive agreement, each share
    of GenRad stock would be converted into .1733 shares of Teradyne stock. Teradyne believed
    that the acquisition would initially be dilative, but expected through synergies and an increase
    in demand, would become accretive in 2002. By September 2001, the economic condition of
    the United States had deteriorated. Accelerated by the terrorist attack on New York’s World
    Trade Centre Towers, American consumers further withdrew from traditional spending
    habits. The board had to decide whether or not this was the right time to undertake such a
    complex integration and if the economy would recover in time to have the transaction
    contribute to earnings on schedule. Off course, the answer is yes.
    This move makes sense from a number of perspectives. The merged company will have a
    much stronger test and measurement presence, making the new Teradyne a stronger company
    going forward. This move also positions Teradyne to enhance their suite of products and
    services they can offer to their customers around the globe. The two companies have a well-
    deserved reputation for integrity and innovation, so cultures should blend easily. After
    economy recover from crises this merger would prove beneficial for both the companies.

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