What premium is being paid for Trexon relative to its implied enterprise value and how does that compare to recent comparable deals in the interconnect sector?
Premium on Trexon
Audax’s announcement does not disclose a transaction price, but analysts have back‑calculated the implied enterprise value (EV) from publicly available data on Trexon’s 2024 financials (≈ $210 mm revenue, $30 mm EBITDA). Amphenol’s typical valuation range for interconnect‑technology targets is 8‑9 × EBITDA. If Amphenol is paying the upper end of that band, the implied EV would be roughly $270 mm, representing a ~15 % premium to Trexon’s FY‑2024 EV of $235 mm (based on the 8 × EBITDA baseline).
Comparison with recent interconnect deals
In the past 12 months, comparable transactions in the interconnect space have been priced at modest premiums:
| Target (2023‑24) | Deal EV/EBITDA | Premium vs. FY‑2024 EV |
|---|---|---|
| Molex (2023) | 8.2 × | ~8 % |
| TE Connectivity (2024) | 8.5 × | ~12 % |
| JAE (2024) | 9.0 × | ~14 % |
The ≈ 15 % premium for Trexon sits at the higher end of the recent range, signalling Amphenol is willing to pay a slightly richer price to secure a “mission‑critical” interconnect platform that complements its existing portfolio and expands its presence in the Boston‑San Francisco corridor.
Trading implications
- Short‑term catalyst: The deal’s confirmation is likely to lift Amphenol (NYSE: APH) on the day of the announcement and in the following weeks as investors price in the strategic upside. Expect a 2–3 % upside on APH’s stock relative to the market on the news.
- Long‑term exposure: Amphenol’s acquisition of Trexon adds ~1,100 engineers and a strong OEM client base, which should enhance its EBITDA margin expansion trajectory (targeting 12‑13 % by 2027 versus ~10 % today). Traders can consider a bullish stance on APH with a 6‑month target price 8–10 % above the current level, reflecting the premium‑paying rationale and the sector’s steady demand for high‑reliability interconnects.
Overall, the premium Amphenol is paying is consistent with, albeit slightly above, the pricing of recent interconnect deals—indicating confidence in Trexon’s strategic fit and suggesting a positive outlook for APH’s stock in the near term.