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Danish government blocks Hamamatsu acquisition of NKT Photonics

03 May 2023

Deal valuing the company at €205M had been expected to complete in March.

The Danish government has blocked the planned sale of NKT Photonics to Japan’s Hamamatsu.

Announced in June last year, the agreement had valued NKT Photonics at €205 million, and had been expected to go through in March 2023.

However, a brief statement from NKT, the parent company of NKT Photonics, indicated that the Danish Minister for Industry, Business, and Financial Affairs - Morten Bødskov - had declined to authorize the deal.

It pointed out that under the terms of the Danish Investment Screening Act, foreign company investments can be denied if they are seen to pose a threat to national security or public order in Denmark. The Ministry has not yet disclosed a specific reason for its decision.

NKT said that over the past few months regulatory approvals had already been obtained from the relevant authorities in Germany, the UK, and the US, before it received notice of the Danish decision on May 2.

The firm added that it is now awaiting further action in response to the decision from Hamamatsu, while NKT is evaluating its options separately. “NKT deems to be contractually well protected against the situation,” it said.

Growth potential
On announcing the Hamamatsu deal last June, NKT Photonics’ CEO Basil Garabet had hailed the plan as one that would have seen the company flourish, and to grow even more quickly thanks to access to Hamamatsu’s global presence and big sales force.

Hamamatsu is a company that “lives and breathes photonics”, Garabet told optics.org at the time, also pointing out its exposure to the semiconductor industry as a major opportunity for the Danish firm.

Hamamatsu’s CEO Akira Hiruma added: “The integration of our two companies allows us to enlarge our portfolio of solutions for use in, for example, the industrial, scientific, and healthcare sector[s]. NKT Photonics will constitute our dedicated fiber and laser division, an area where we see significant growth potential.”

Garabet also said that the sale of NKT Photonics to Hamamatsu would mark the “final step” in a process allowing NKT A/S to fully focus on its core business of power cables. The parent firm had originally established a series of photonics-based startups in the early 2000s, notably the photonic crystal fiber (PCF) specialist Crystal Fibre.

A series of acquisitions followed, with NKT Photonics adding UK-based PCF firm Blaze Photonics and fiber laser specialist Fianium, the ultrafast laser maker OneFive, Germany-based sensing firm LIOS Technology (since sold to Luna), and the pulsed laser diode maker ALS.

If the deal had gone through, NKT Photonics had been expected to become a subsidiary of the Hamamatsu Photonics group with responsibility for fiber and laser development and manufacturing.

Its product portfolio was set to remain unchanged, with its name and branding retained, no plans for changes to its global sites - and all of NKT Photonics’ 400-strong workforce expected to transfer to Hamamatsu.

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