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EFJ Posts a Profit, Agrees to Buy-Out

One of the big names in public safety radio, EF Johnson Technologies Inc., announced today that it will be acquired by a private equity firm, on the same day the company also announced a rare quarterly profit. The company has been facing cash flow problems lately, and earlier this year said it had retained an advisor for a possible sale of the company. Under the acquisition agreement, Francisco Partners will pay $1.05 per share for the company, or about $28 million. The stock closed at $1.02 on Friday. The company’s revenues for the first quarter of 2010 were $29.3 million, up 33% compared to the same quarter of 2009. The company attributed the increase to delayed shipments from the previous quarter and increased service revenues from government contracts. The revenues were partially offset by lower federal revenues, the company said in a press release. Profit for the quarter was $190,00, compared to a loss of $1.6 million for the same quarter of 2009. EFJ president Michael Jalbert said the company anticipates lower revenues for the second quarter. EFJ was founded in 1923 by Edgar F. Johnson as a radio parts business, went public for the first time in 1976, was purchased by Transcrypt International in 1997, and then went public again in 2004. Many of the company’s contracts are with federal government agencies, and not with local counties or cities. Its largest single order was with the Department of Defense in 2006, totaling $76 million.

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