Benzinga | Jun 17, 2021 07:01AM EDT

Brady Corporation Acquires Code Corp. For $173M

Brady Corporation (NYSE:BRC) ("Brady") announced today that it has acquired The Code Corporation ("Code" or the "Company") for approximately $173 million. Brady will fund the transaction with cash on hand as well as with borrowings on its existing revolving line of credit. Code has forecasted sales of approximately $50 million for Brady's first full fiscal year of ownership, which is for the year ending July 31, 2022. Brady anticipates EBITDA from Code of approximately $10 million for the first full fiscal year ending July 31, 2022, inclusive of integration-related costs.

Code specializes in high-quality barcode scanners and the associated software to power track-and-trace applications. The Company was founded more than 20 years ago and is headquartered in Salt Lake City, Utah. The majority of Code's sales are into the U.S. healthcare industry. The Company also has a growing product offering of barcode scanners designed for industrial track-and-trace applications. Brady is a leader in high-performance niche application industrial printers and materials, and the acquisition of Code will better position Brady as a full-service provider of industrial track-and-trace applications.

"Code is a highly-regarded brand for its offering of durable high-performance barcode scanners," said Brady's President and Chief Executive Officer, J. Michael Nauman. "The addition of Code's high-quality complementary product offering to Brady's already existing leadership position in niche application industrial printers and materials will accelerate Brady's expansion in the industrial track-and-trace market. Once integrated, our complete service offering in these faster growing end markets should accelerate Brady's overall growth profile. We also intend to increase investments in research and development and increase Code's addressable market through Brady's global footprint throughout Europe, Asia and the Americas."

Kent Hansen, CEO of Code stated, "Over the last several years, we expanded our product offering, developed strong software solutions, expanded our patent portfolio, and have secured a strong position in the healthcare industry. We are proud of what we've accomplished at Code. The sale of Code to Brady, a market leader in printing and materials, is a very exciting next chapter for The Code Corporation. Brady's strong presence in both healthcare and industrial settings will most certainly open up many more opportunities than those that would have been available to us as an independent company. We believe that the sale to Brady provides an unparalleled opportunity for future growth, access to new markets and access to new customer sets."

A webcast regarding this acquisition will be available at www.bradycorp.com/investors beginning at 9:00 am central time tomorrow, June 18, 2021.