Needham & Company Reiterates Hold as iRobot Corp. (IRBT) Announces SDOC Acquisition
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Needham & Company reiterated a Hold rating on iRobot Corporation (NASDAQ: IRBT) following the company's announced agreement to acquire Sales On Demand Corporation. The acquisition of SODC, which had an exclusive distribution arrangement with IRBT, is consistent with the company's strategy to take more control of marketing and distribution in key overseas markets.
Analyst James Ricchiuti commented, "IRBT yesterday announced a definitive agreement to acquire the iRobot-related distribution business in Japan of Sales On Demand Corporation (SODC), its longtime distribution partner in that country. SODC represented 15% of IRBT's home robot revenues in 2015. IRBT is paying $14-16M to acquire SODC, subject to exchange rates at the close of the acquisition, which is expected in April 2017. IRBT expects SODC to add $20-25M of incremental revenue in 2017. SODC is expected to be $0.25-0.35 dilutive to IRBT's 2017 earnings, which reflects a one-time, fair-value accounting adjustment and expense associated with the acquisition."
Shares of iRobot Corporation closed at $54.09 yesterday.
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Related EntitiesNeedham & Company, Earnings, Definitive Agreement
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