IRVINE, Calif. - Lantronix Inc. (NASDAQ:LTRX) announced today an agreement to acquire the industrial IoT business assets of Vecima Networks Inc. (TSX:VCM), including its Nero Global Tracking software-as-a-service platform, for approximately $11.5 million.

The acquisition adds $5.3 million in total revenue, including $4.5 million in annual recurring revenue and approximately 125,000 asset tags under management, according to a press release statement. The business operates with gross margins in the high-60% range.The deal represents approximately 4.5% of Lantronix’s current revenue base of $118.6 million over the last twelve months, while the acquired business’s high-60% gross margins notably exceed Lantronix’s own 43% margin. According to InvestingPro analysis, the company maintains a strong current ratio of 2.74, indicating solid financial capacity to execute the acquisition. While Lantronix hasn’t been profitable over the last twelve months, analysts predict the company will turn profitable this year—one of several key insights available in the comprehensive Pro Research Report covering LTRX and 1,400+ other US equities.

The transaction increases Lantronix’s software and services revenue to more than 10% of total company revenue. The deal is expected to close in the near term, subject to customary closing conditions.

Nero Global Tracking provides GPS-based vehicle and asset tracking for fleet operators, municipalities, restoration contractors and industrial customers throughout North America. The approximately 30-person IIoT team will join Lantronix.

"This acquisition is consistent with our platform strategy and advances exactly where we are looking to take Lantronix: toward higher-margin, recurring-revenue solutions that combine our edge hardware, connectivity and software capabilities," said Saleel Awsare, President and CEO of Lantronix.

Sumit Kumar, President and CEO of Vecima Networks, stated the transaction "gives our IIoT team, customers, and channel partners access to a larger global platform with a more comprehensive, end-to-end solution."

The purchase price excludes working capital and other customary adjustments, as well as acquisition-related costs.

Lantronix describes itself as a provider of Edge AI and Industrial IoT solutions. Vecima Networks operates in broadband and video markets.

In other recent news, Lantronix Inc. announced the pricing of a $30 million stock offering at $7.20 per share. This offering is expected to generate gross proceeds of approximately $30 million before expenses. Additionally, Lantronix launched the SLC 9000 console manager, designed for AI data centers and other industrial applications, which integrates with its Percepxion cloud management platform. This new device offers features such as remote access and cloud-native fleet management.

In analyst coverage, both Needham and Canaccord Genuity initiated coverage on Lantronix with buy ratings, setting price targets of $11.00 and $10.50, respectively. These firms view Lantronix as a significant player in next-generation unmanned systems and edge computing. Furthermore, Lantronix is set to be included in the preliminary list of additions to the Russell 3000 Index, as published by FTSE Russell. This inclusion reflects the company’s growing market presence.

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