Canon Inc plans to buy network video surveillance leader Axis AB for about 23.6 billion Swedish crowns ($2.83 billion), the biggest purchase ever for the Japanese company that is trying to expand beyond the shrinking camera market.
Canon said it was launching a tender offer to buy all Axis shares for 340 crowns each, a premium of nearly 50 per cent to its closing price of 226.90 on Monday.
The Swedish company said its board of directors unanimously supported the offer, and that three of its top shareholders representing around 40 per cent of total shares will accept it.
Canon already sells surveillance cameras and sees the sector as a growing market, although it has not disclosed how much it earns from such products.
The deal will make Canon a top player in the video surveillance market, which was worth an estimated $15 billion at the end of last year, according to researcher IHS. Within that market, there is a $3.86 billion segment for network-connected security cameras which is led by Axis with a 17.5 per cent share as of 2013.
The deal comes after Canon late last month reported a slight increase in fourth-quarter profit, as a weaker yen and rising sales of office equipment offset weakness in a camera division competing with smartphones capable of high-quality imaging.
The company, which earned over 80 per cent of its revenue overseas in 2014, said it would pay in cash.
