LSI Industries acquires EMI Industries for $50m to enhance retail display solutions

LSI Industries Inc. (NASDAQ: LYTS), a prominent U.S.-based manufacturer of commercial lighting and display solutions, has announced the acquisition of EMI Industries for an all-cash transaction valued at $50 million. EMI, a Florida-based leader in metal and millwork manufacturing, is known for its custom fixtures and displays catering to the convenience store, grocery, and restaurant sectors. This acquisition marks a strategic expansion for LSI, broadening its product and service offerings within the retail fixtures and display market.

The acquisition of EMI Industries allows LSI to significantly expand its capabilities in the retail display solutions market. EMI brings over 40 years of expertise in creating innovative solutions that drive customer traffic and enhance shopping experiences across various industries. This partnership is expected to provide considerable commercial and operational synergies, enhancing LSI’s comprehensive suite of solutions. James A. Clark, President and Chief Executive Officer of LSI, emphasized the strategic fit, stating, “The addition of EMI serves to broaden our product and services capabilities within retail fixtures, displays, and food equipment.”

In the fiscal year 2023, EMI reported revenues of approximately $87.0 million and an adjusted EBITDA of $5.5 million. The acquisition is projected to be immediately accretive to LSI’s earnings per share on an adjusted basis, supporting LSI’s strategic growth plan outlined in its Fast Forward strategy. This strategy aims for a net sales increase of over 60% from fiscal year 2023 to fiscal year 2028, with acquisitions significantly contributing to this growth.

The acquisition positions LSI to capitalize on the ongoing investment cycles in the grocery, refueling/c-store, and restaurant markets. The combined business is expected to enhance LSI’s ability to offer integrated solutions from product design to post-sale support, fulfilling a broader range of customer needs. Clark added, “As we bring together our complementary products, services, and technologies, there are significant cross-selling opportunities that enable us to be a single-source provider to more customers throughout North America.”

Following the transaction, EMI will operate as an independent brand within LSI’s display solutions segment. The company will retain EMI’s leadership team and its production facilities, ensuring continuity and stability. Alan Harvill, President and CEO of EMI, expressed enthusiasm about joining LSI, stating, “We are proud to become the newest part of the LSI team and look forward to unlocking the powerful potential of the combined businesses.”

LSI’s acquisition of EMI is consistent with its Fast Forward strategy, which emphasizes sustained commercial expansion, operational excellence, and disciplined capital allocation. By fiscal year 2028, LSI anticipates more than doubling its adjusted EBITDA and achieving significant margin expansion, driven by a mix of organic and inorganic growth initiatives.

This acquisition not only reinforces LSI’s position as a leader in the commercial lighting and retail display solutions market but also aligns with the company’s long-term strategic goals, enhancing its competitiveness and market presence in North America.