Comtech Telecommunications Corp., Long Island’s 13th largest public company, has agreed to acquire a Canadian satellite communications company for about $40 million, the companies announced Thursday.
Privately held UHP Networks Inc., based in Pointe-Claire, Quebec, makes satellite networking equipment used in ground stations, a market where Melville-based Comtech competes.
The deal provides for Comtech to pay as much as an additional $10 million if UHP reaches specified sales benchmarks over a 12-month period after the close of the deal, which is expected in the second half of fiscal 2020.
“With end-markets for high-speed satellite-based networks significantly growing, Comtech’s acquisition of UHP is a significant step in enhancing our solution offerings for the satellite ground station market,” Fred Kornberg, Comtech’s president and chief executive, said in a statement.
Vagan Shakhgildian, who will continue as president of UHP, called the combination with Comtech “compelling” and said UHP’s customers would benefit from Comtech’s deeper resources.
All of UHP’s employees are expected to remain with the company.
A Comtech spokesman did not immediately respond to a request for further comment.
Both companies sell products to government agencies and telecommunications companies such as Verizon, one of Comtech’s customers. Comtech also operates in the electronic warfare, 911 and digital mapping and location services markets.
Shares of Comtech rose 0.5 percent Thursday to close at $35.99. Comtech posted 2018 revenue of $570.6 million, the 13th highest of any public company on Long Island.
Comtech said it would provide additional details about the UHP transaction when it reports its financial results for the quarter ended Oct. 31.
In February, Comtech acquired Solacom Technologies Inc., a provider of 911 services, for $33 million, and in April, the company bought the state and local 911 business unit of General Dynamics Information Technology Inc. for an undisclosed amount.