FOR IMMEDIATE RELEASE: MAY 17, 2000
CONTACT: Tom Madsen Ted Sharp
President/CEO Chief Financial Officer
Key Technology, Inc. Key Technology, Inc.
(509) 529-2161 (509) 529-2161
KEY TECHNOLOGY ANNOUNCES
PLANS TO ACQUIRE FARMCO, INC.
WALLA WALLA, WA - Key Technology, Inc. (NASDAQ/NMS: KTEC) a world leader in
process automation equipment primarily for the food processing industry,
announced today that it has signed a definitive Agreement to acquire Farmco,
Inc., a privately held corporation.
Farmco, headquartered in Redmond, Oregon, supplies and services mechanical
sizing, sorting, separating and grading machines to the processed fruit,
vegetable and potato industries. The company has a strong customer base in the
food processing industry and has over 650 machines operating worldwide. The
acquisition also includes Farmco's sister company, Ro-Tech, Inc., a research and
development subsidiary, which performs all of the engineering and equipment
design for the products manufactured by Farmco. Farmco had sales of $4.3 million
in 1999.
Under the terms of the agreement, Key Technology will purchase all of the
outstanding stock of Farmco and Ro-Tech for cash. The transaction, which is
subject to various closing conditions, is anticipated to close in the third
quarter of Key's fiscal year 2000. Key expects the acquisition to be accretive
to earnings in the fourth quarter of fiscal year 2000.
Farmco will continue to operate in Redmond and will be led by General Manager,
Neil Burck, who has been with the company since 1994. In addition, John Mobley,
the company's current owner, will serve as Senior Research and Development
Engineer. Farmco will report to Gordon Wicher, Vice President-General Manager of
Key's Specialized Conveying Systems Business Unit.
"The acquisition of Farmco strengthens Key's position in the food processing
equipment market with additional strategic, creative and technological
capabilities. Our ability to solve the difficult processing problems of our
customers and our ability to offer process automation solutions will be greatly
enhanced with the addition of Farmco's innovative product line,"
<PAGE>
commented Thomas C. Madsen, President and CEO of Key Technology.
"Farmco is a well-run company and fits perfectly into Key's strategy to offer
our customers 'one-stop shopping' for process automation systems. Farmco's
products will be sold through Key's existing sales channels, which will allow
for greater geographic penetration and provide new opportunities to sell
complementary equipment from Key's existing product lines, including optical
products such as the Tegra[REGISTERED TRADEMARK] and
ADR[REGISTERED TRADEMARK]4."
Key Technology, an ISO-9000 certified company, is a leading designer and
manufacturer of process automation systems, primarily for the food processing
industry, which integrate electro-optical inspection and sorting, specialized
conveying and product preparation equipment. Key systems allow processors to
improve quality, increase yield and reduce cost. With worldwide sales and
service, the company maintains manufacturing facilities and demonstration
laboratories in Beusichem, the Netherlands and Walla Walla, WA.
COMMENTS INCLUDED IN THIS DOCUMENT MAY INCLUDE "FORWARD-LOOKING STATEMENTS"
WITHIN THE MEANING OF THE FEDERAL SECURITIES LAWS. THESE STATEMENTS AS TO
ANTICIPATED FUTURE RESULTS ARE BASED ON CURRENT EXPECTATIONS AND ARE SUBJECT TO
A NUMBER OF RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE PROJECTED OR DISCUSSED HERE. SUCH RISKS AND UNCERTAINTIES
ARE DETAILED IN THE COMPANY'S ANNUAL REPORT ON EXHIBIT 99.1 OF THE FORM 10-K
FILED WITH THE SEC IN DECEMBER 1999 AND ARE INCORPORATED HEREIN BY REFERENCE.
THE COMPANY CAUTIONS READERS NOT TO PLACE UNDUE RELIANCE UPON ANY SUCH
FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE HEREOF. THE COMPANY
DISCLAIMS ANY OBLIGATION SUBSEQUENTLY TO REVISE FORWARD-LOOKING STATEMENTS TO
REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE OF SUCH STATEMENTS OR TO REFLECT
THE OCCURRENCE OF ANTICIPATED OR UNANTICIPATED EVENTS.
Note: News releases and other information on Key Technology, Inc. can be
accessed at www.keyww.com on the Internet
[COPYRIGHT]Key Technology, Inc.
