The purchase price for Innotech was comprised of $7M in cash at closing, assumption of a $2.5M three-year interest free subordinated seller note and potential earn out payments of up to $6M over three years. The company entered into a debt financing arrangement with Comerica Bank to facilitate the acquisition.

Innotech is a value-added manufacturer of customised video, security surveillance systems and components for major U.S. retailers, restaurant chains and public venues requiring high quality, surveillance security which generated approximately $8M in revenue during 2016.

James Pritchett, President and Chief Executive Officer of the company, stated, “This is an excellent fit for Costar as we combine with a highly-regarded brand in the retail video surveillance market. We look forward to welcoming the Innotech team to Costar. The combination will provide significant operational benefits and substantial synergies in many areas, including marketing, sales and product development. Innotech’s product offerings are complementary to Costar’s products and solutions, and because Costar and Innotech serve different integrator and retail customers, the acquisition creates many cross-selling opportunities. We believe our combined sales organisation will be able to expand our product penetration in existing markets and promote Innotech’s products in new markets, accelerating the growth of our sales footprint. We anticipate the acquisition to be immediately accretive to earnings beginning the first quarter of 2017.”

Mr. Pritchett went on to say, “The Innotech acquisition is consistent with our strategy of providing high quality solutions to our customers. Our customers will have access to a broader product line while continuing to receive the same high level of sales, service and support that they have come to expect from Costar and Innotech.”

Devin Benjamin, Senior Vice President of Innotech, commented, “We are very excited to join the Costar team and carry on Innotech’s 10-year history in the video camera market. Our combined resources and expanded product offering will generate additional opportunities for our video cameras in new commercial channels.”