DeWITT - Anaren, Inc.'s (NASDAQ: ANEN) acquisition of M.S. Kennedy Corp. of Clay will allow the newly combined company to pursue new business, Anaren's CEO says.

Anaren closed on the deal Aug. 1.

M.S. Kennedy provides microelectronics for the defense and space markets. It has been growing strongly in the past few years and generated net sales of $22.4 million in 2007, according to Anaren.

DeWitt-based Anaren paid $28 million - $24.2 million after adjustments - for M.S. Kennedy. Anaren, which announced plans for the acquisition in April, develops and manufactures components and subsystems for the military and wireless-communications markets.

The combination of technology between the two companies will allow Anaren to chase work in new areas in the military, satellite, and aerospace markets, Lawrence Sala, Anaren chairman, president, and CEO, said during an Aug. 6 conference call.

Specifically, M.S. Kennedy provides components for avionics applications in finished products like unmanned aerial vehicles, missiles, and general commercial and military aircraft, Sala said. The expertise will eventually allow Anaren to go after new work in radar applications.

Currently, Sala said, Anaren builds a specific piece of a radar component. Adding M.S. Kennedy (MSK) will allow the company to build that entire component from end to end.

"MSK was a way to accelerate our ability to provide a total solution to our customers," Sala said.

Sala said he expects 5 percent to 10 percent growth at M.S. Kennedy going forward. The business has performed at that level for the past several years, he added.

M.S. Kennedy's current management team will remain inplace and the company will continue to operate from its Clay location.

The acquisition should add to Anaren's earnings in its 2009 fiscal year, which began July 1, says George Blanton, Anaren's CFO.

Anaren earned $1.2 million, or 8 cents a share, during its fiscal fourth quarter, down 72 percent from a year ago. The company earned $4.3 million, or 25 cents a share, in the same period last year.

Sales for the fourth quarter totaled $34.2 million, down $1.7 million from a year ago.

Wireless sales for the quarter totaled $19.5 million, down 15.5 percent from the fourth quarter of 2007. Space and defense sales in the period totaled $14.7 million, up 15.3 percent from a year earlier.

For the first quarter of fiscal 2009, Anaren is projecting sales of $33 million to $36 million and net income of 6 cents to 10 cents a share.

For the company's 2008 fiscal year, Anaren generated $131.3 million in net sales, up 1.8 percent from 2007. The firm earned $9.2 million, or 61 cents a share, for the year, compared with $15.3 million, or 87 cents a share, a year earlier.

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