Hexatronic acquires leading microtubing company KNET for an estimated US$63 million

Hexatronic Group AB

Hexatronic Group AB

press release
November 24, 2022
Gothenburg, Sweden

Hexatronic acquires leading microtube business KNET for an estimated USD 63 million

Hexatronic Group AB (publ) (“Hexatronic”) has entered into a definitive agreement to acquire KNET CO., LTD (“KNET”) – one of the world’s leading providers of microduct solutions to the telecom industry – for an expected enterprise value of USD 63 million.


KNET is a global leader and pioneer in the design and manufacture of microduct solutions for the telecommunications industry. Since 2002, the company has shipped to more than 70 countries on 5 continents. Today the main markets are North America, followed by Europe and Asia.

KNET is headquartered in Seoul and has a manufacturing facility in Jeongeup-si in southern South Korea. The company also has offices in the US and Indonesia. The purchase also includes the land and buildings of the production facility.

Upon completion, KNET will operate as an independent company with the existing management team and will continue to serve all existing customers under the KNET brand.

The seller, who is also a founder, will retain his current position as chairman of KNET.

Transaction overview

The purchase price for KNET is a fixed enterprise value of $48 million plus potential earn-out based on accumulated EBITDA for the 36 month period post closing. The potential earn-out is estimated at $15 million.

For the current year ending December 31stSt, KNET is expected to generate more than $10 million in EBITDA. This equates to a fixed transaction multiplier of around 4.6x and an expected transaction multiplier, including earn-out, of around 6.1x.

The maximum earn-out is US$36 million and will be achieved if KNET generates accumulated EBITDA of more than US$63 million for the 36-month period. If the accumulated EBITDA for the same period is less than $27 million, no earnout will be paid.

The fixed purchase price of $48 million is payable in cash at closing and is fully funded by senior debt. The third quarter pro forma net debt to EBITDA ratio for the Hexatronic Group is expected to be approximately 1.8 following the transaction, including the previously announced transactions. The acquisition will have an immediate positive impact on earnings and is expected to add SEK 0.28 per Hexatronic share annually.

The acquisition is expected to close on December 1, 2022.

Comments from the CEO of Hexatronic

“We are very pleased about the agreement to acquire KNET. We have been working with the highly qualified team at KNET for more than 10 years and are impressed by the product quality and innovative ability. Over the years, KNET has been an important partner of Hexatronic. Both as a volume supplier manageng Demand peaks, but also for products with high technical requirements. KNET’s strong support has been critical to our strong growth and recent success in North America. Today, Hexatronic is KNET’s largest customer.

We look forward to welcoming the dedicated team from KNET to the Hexatronic Group. The technical and innovative skills will bring great added value to Hexatronic. In addition, we gain access to a high quality, high volume manufacturing facility that is strategically located to serve our businesses in North America. Europe and Oceania”says Henrik Larsson Lyon, CEO of Hexatronic Group.

Comments by the KNET Chair

“Hexatronic is a long-term strategic partner of KNET and it is a natural and exciting progression to join the Hexatronic Group. We look forward to further support all our existing customers as well hexatronics ambitious growth aspirations in its key markets”says Seo Seong Nam, Founder and Chairman of KNET.

White & Case and Shin & Kim acted as legal counsel for the acquisition of KNET.

Gothenburg, November 24, 2022

Henrik Larsson Lyon
CEO of the Hexatronic Group

For more information, please contact:
Henrik Larsson Lyon, CEO Hexatronic Group, +46 706 50 34 00
Pernilla Lindén, CFO Hexatronic Group, +46 708 77 58 32

This is information that Hexatronic Group AB (publ) is obliged to publish according to EU Market Abuse Regulation. The information for the publication was transmitted via the above-mentioned contact person at 07:00 CET on 24 November 2022. This is a translation of the Swedish version of the press release. In case of doubt, the Swedish wording applies.

Hexatronic creates sustainable networks all over the world. We work with customers on four continents – from telecom operators to network owners – providing leading-edge, high-quality fiber optic technology for every imaginable application. Hexatronic Group (publ.) was founded in Sweden in 1993 and is listed on Nasdaq OMX Stockholm. Our global brands include Viper, Stingray, Raptor, InOne and Wistom®.



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