With 20 years of experience under its belt, electronic and optical hardware manufacturer and service provider Celetron International Ltd. cast its line into the private equity pond earlier this month for the first time and hooked $48 million.
Golden Gate Capital led the Series A deal, and was joined by New Enterprise Associates, Baring Asia Private Equity Fund II and Alta Partners.
Although Celetron is based in Simi Valley Calif., it does all its manufacturing in India, which is fast becoming one of the most desirable places to do business because of the labor pool?s tech savvy and low cost.
“[India] is one of the largest exporters of software and we think similar success can be achieved on the hardware side because there is incredible demand from U.S. companies,” said Jugi Tandon, chief executive with Celetron. “And eventually the market will develop in India and we will be there.”
Celetron also has fulfillment facilities in Asia, the United States, Europe and Sri Lanka, with over 5,000 employees on hand to service approximately 30 customers.
The cash infusion will be used to accelerate the company?s growth in optical packaging, manufacturing, memory module test and assembly, among other things.
Although the company has been profitable almost since its founding, Tandon said Celetron was willing to slip into the red as part of the venture financing so that it could bring on additional capital that would help it expand at a faster pace.
Tandon is not worried about a return to profitability since Celetron had fiscal 2000 revenue of $250 million ? a number that he expects to climb as high as $1 billion by 2003.
Tandon added that he doesn?t believe the company will need another private equity round.
Prescott Ashe, a managing director at Golden Gate, agreed with Tandon, adding he would like to see an IPO in the near future. “We think [the money raised] is adequate at this point and our objective is an IPO. We have a multi-year time frame to go public and there seems to be a lot of appetite for these kind of companies. When we see keen interest we will take it public.”
Ashe added that introductions between Celetron and other Golden Gate Capital portfolio companies have already been made. “Things are definitely in the works but business takes time to develop.”
Contact Danielle Fugazy: Danielle.Fugazy@tfn.com