EnerSys Offers $16 a Share to Buy Ultralife in $320 Million Deal
Key Facts
EnerSys has entered into a definitive agreement to acquire Ultralife for approximately $320 million, including the assumption of net debt, for $16 in cash per share, according to an Ultralife filing with the U.S. Securities and Exchange Commission. The agreement was announced on October 27, following unanimous approval by both companies’ boards, according to an EnerSys statement. The offer represents a 166% premium to Ultralife’s closing share price on October 26. The deal is structured as a tender offer followed by a wholly owned subsidiary merger, and the companies will continue to operate independently until closing. At the time of the statement, the tender offer had not yet commenced, and the agreement remained subject to completion of the offer and required approvals.
EnerSys is targeting annualized savings of $15 million to $20 million within the first 18 months after the deal closes, according to its filing with the SEC. The company said the acquisition expands its capabilities in defense power solutions, including munitions, soldier power, unmanned aircraft, counter-drone systems and autonomous systems. Chief Executive Sean O’Connell described the deal as “a strong strategic fit for EnerSys, directly advancing our strategy to build a broader and more differentiated defense power platform.” He added that these technologies support U.S. and allied forces on a battlefield moving toward greater electrification. The company expects the deal to begin adding to adjusted diluted earnings per share within about 18 months of closing.
Ultralife’s results for the third quarter of 2026 show expansion in its business, with revenue of $48.271 million, up 11.3% year over year from $43.371 million in the same period of 2025. Battery and Energy Products segment revenue rose 12.9% to $45.088 million, according to the quarterly report filed with the SEC. Government and defense sales surged 56.7% on strong demand for wearable batteries, while commercial sales fell 5.8%. Backlog stood at $136 million at quarter-end, the highest level in the company’s history, compared with $117.5 million at the end of the second quarter and $90.3 million a year earlier. The results put the defense business at the center of Ultralife’s growth, which EnerSys is seeking to add to its portfolio.
Ultralife’s operating income turned positive at $3.186 million in the third quarter, after an operating loss of $951,000 a year earlier, according to the quarterly report. The company attributed the improvement to sales growth, a stronger gross margin and expense control, with gross margin improving 530 basis points year over year. It reported net income of $2.368 million, or $0.14 a share, compared with a net loss of $1.220 million, or $0.07 a share, in the third quarter of 2025. The comparison reflects improved profitability alongside revenue growth and a rising backlog. This provided an operating backdrop to the deal, alongside the cash consideration EnerSys offered Ultralife shareholders.
EnerSys reported adjusted diluted earnings per share of $3.22 in the second quarter of its fiscal 2027, compared with $2.65 in the same period of the previous fiscal year. Sales were $949.9 million, compared with $951.3 million a year earlier, a decline of 0.1%, according to the company’s results. For the third quarter of fiscal 2027, EnerSys forecast sales of $935 million to $975 million and adjusted diluted earnings per share of $3.05 to $3.15. It said the forecast excludes the impact of the proposed acquisition, making it an estimate of the company’s performance before any contribution from Ultralife. Management attributed its outlook to continued strength in aerospace and defense, data centers and transportation, alongside improving communications and early signs of a recovery in material handling.
In its second-quarter results, EnerSys said Precision Power Solutions sales grew more than 20% year over year, supported by strong demand for soldier power and munitions. These operating indicators link the expansion in defense demand at both companies to the deal’s strategic direction, while Ultralife’s contribution is not included in EnerSys’ current quarterly guidance. Ultralife Chief Executive Michael Manna said the deal opens up greater opportunities for the company’s employees, while EnerSys’ statement said the offer gives shareholders certain cash value. EnerSys said it will fund the deal with available cash. It expects to complete the transaction in the first quarter of 2027, subject to customary closing conditions, including tender shares representing a majority of Ultralife’s shares and regulatory approvals.