EnPro Industries to Acquire LeanTeq Co., Ltd.

EnPro Industries, Inc. (NYSE: NPO), a manufacturer of highly engineered industrial products, today announced that it has entered into an agreement to acquire LeanTeq Co., Ltd., a privately-held, Taiwan-based company. LeanTeq primarily provides refurbishment services for critical components and assemblies used in state-of-the-art semiconductor equipment. This equipment is used to produce the latest and most technologically advanced microchips for smartphones, autonomous vehicles, high-speed wireless connectivity (5G), artificial intelligence, and other leading-edge applications. Upon completion of the acquisition, LeanTeq will be part of EnPro’s Technetics Group within the Sealing Products segment. Technetics Group designs and produces custom, highly engineered components for demanding applications in the semiconductor, aerospace and nuclear markets.

LeanTeq partners closely with OEMs throughout the development and production lifecycle to achieve Process of Record qualifications, enabling long-term, recurring aftermarket revenue. Aftermarket refurbishment services represent approximately 65% of LeanTeq’s total sales. LeanTeq’s suite of services includes cleaning, coating, analytical testing, inspection and verification, kit assembly, failure analysis, and other value-added services. Founded in 2011 and headquartered in Taoyuan City, Taiwan, LeanTeq has two locations in Taiwan and one in the United States (Silicon Valley), and approximately 260 employees.

“LeanTeq complements Technetics Group, adding to our deep expertise and expanding the mission-critical suite of products we offer to our customers,” said Steve Macadam, President and Chief Executive Officer of EnPro. “The acquisition of LeanTeq demonstrates our commitment to investing in proprietary technologies in attractive and growing end markets and is consistent with our growth strategy, adding advanced technical capabilities, excellent financial characteristics, an experienced management team and significant aftermarket business. We look forward to welcoming LeanTeq employees to EnPro and working together to create value for our OEM partners, customers, and shareholders.”

Compelling Strategic and Financial Benefits

• Proprietary Capabilities and Technology: LeanTeq maintains a market-leading position with highly differentiated, proprietary technology and processes, and a commitment to stringent technical specifications. LeanTeq is a leader in cleaning for advanced nodes.
• Growth Acceleration: LeanTeq serves the faster-growing advanced technology node market, which is expected to grow 4.5x faster than the broader market through 2025¹, that is benefiting from demand for the latest smartphone technology, autonomous vehicles, high-speed wireless connectivity (5G), artificial intelligence, and other leading-edge applications.
• Strong Customer Relationships: LeanTeq’s unique value proposition, including fast turnaround times and improved yield rates, has resulted in strategic relationships with leading semiconductor companies.
• Experienced Leadership: LeanTeq’s senior executives, who will continue with the business after closing, possess an average of over 20 years of semiconductor industry experience, both in Asia and the U.S., resulting in deep domain expertise and industry relationships.
• Compelling Financial Profile: LeanTeq has strong recurring revenue driven by its aftermarket focus, expected double-digit growth, insulation from industry and economic cyclicality, consistent cash generation and high return on operating capital.

Transaction Terms and Financing