Cemtrex says it intends to buy NYC virtual reality company

Cemtrex Inc., a Farmingdale provider of electronics manufacturing services, has signed a letter of intent to acquire a virtual reality software development studio in Manhattan, the company announced Monday.

Financial terms of the deal and the name of the studio were not disclosed. Cemtrex said in a news release that it is subject to a confidentiality agreement and would “provide details about the acquired company after closing the transaction.”

Cemtrex said it expected to close the deal by year’s end.

The company said the 7-year-old software development studio employs more than 30 programmers and has annual sales of more than $1.5 million.

Saagar Govil, chairman and chief executive, said the acquisition gives Cemtrex software development capabilities.

“This software studio’s experienced workforce has extensive expertise over virtual reality and augmented reality software development,” he said in a statement.

In virtual reality, users are see a virtual world through goggles. In augmented reality, virtual elements are overlaid on the user’s real-world environment as through a mobile device, glasses or goggles.

Last month Cemtrex increased its bid to acquire Key Tronic Corp., a Spokane Valley, Washington, company whose market capitalization is more than twice as large as its own.

Cemtrex, which in September unveiled a one-for-one exchange of its stock, valued at about $3, for the roughly $7 per share Key Tronic, made a revised debt and stock offer the following month that it said was worth $11 per share.

Shares of Cemtrex fell 4.7 percent Monday to close at $2.64. The stock has lost about 36 percent over the past 12 months.

By Ken Schachter

kenneth.schachter@newsday.comkschach

Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.