Novanta Completes $1.2 Billion Acquisition of Runway Buyer LLC, Expands Industrial Technology Portfolio

Transaction Completion and Deal Structure

Novanta Inc., a Canadian corporation, has successfully closed its acquisition of Runway Buyer LLC through its Delaware subsidiary Novanta Medical Technologies Corp., with Novanta Corporation serving as the intermediate parent entity. The filing indicates that on July 23, 2026, the transaction closed following the execution of an Equity Purchase Agreement initially disclosed on June 8, 2026. The acquisition involved the purchase of all issued and outstanding limited liability company interests in Runway Buyer from Runway Midco, LLC, the seller entity in the transaction structure.

The transaction was completed through a multi-party agreement structure designed to facilitate the integration of the acquired assets into Novanta's existing operations. The Previous Form 8-K filing, dated June 8, 2026, provided initial disclosure of the transaction terms, and the company has incorporated those details by reference into this announcement. The completion of this acquisition represents the culmination of a transaction announced earlier in the year and positions Novanta to begin the integration of the newly acquired business into its operating divisions.

Financial Consideration and Payment Terms

The announcement discloses that at the closing on July 23, 2026, Novanta paid approximately $1.2 billion in cash consideration to the seller, subject to customary post-closing adjustments related to cash, working capital, debt levels, and transaction expenses of Runway Buyer as of the closing date. This closing consideration represents the immediate capital outlay required to complete the transaction and gain control of the acquired entity. The filing notes that the actual amount may be adjusted based on the financial condition of Runway Buyer at closing, following standard acquisition adjustment mechanics used in private transactions.

In addition to the upfront closing payment, Novanta has committed to making a milestone payment of $250 million to the seller, with this amount due on or before January 8, 2027. This earnout or milestone structure extends the total transaction consideration beyond the initial $1.2 billion payment and represents a performance-based or time-contingent component of the overall deal value. Combined, the closing consideration and milestone payment total $1.45 billion, making this one of Novanta's largest capital deployment transactions. The timing and conditions for the milestone payment are not detailed in the filing beyond the specified due date.

Debt Financing and Credit Facility Utilization

To fund the acquisition, Novanta's Intermediate Parent entity borrowed $616 million in the aggregate under both its revolving credit facility and delayed draw term loan facility, pursuant to its Fourth Amended and Restated Credit Agreement. The filing indicates that these borrowings were executed on July 22, 2026, one day before the closing, timing the debt financing to coincide with the completion of the transaction. The remaining consideration beyond the $616 million debt raise was funded through cash on hand, indicating that Novanta maintained sufficient liquidity to cover the gap between new debt issuance and the total $1.2 billion closing consideration.

The borrowings under both the revolving credit facility and the delayed draw term loan facility are due upon maturity of the Fourth Amended and Restated Credit Agreement in June 2030. The filing notes that these borrowings may be repaid at any time prior to maturity without prepayment penalty, providing flexibility for refinancing or early repayment if business conditions permit. This debt structure gives Novanta a four-year window before the borrowed funds must be repaid or refinanced, allowing time for the acquired business to contribute to cash generation and debt service capabilities.

Pro Forma Debt Position and Leverage

Following the July 22, 2026 borrowings to fund the acquisition, Novanta's consolidated debt totaled $854.7 million as of that date. This represents the company's total outstanding debt obligations across all entities following the new borrowings, which includes the $616 million newly drawn under the credit facilities plus pre-existing debt obligations. The consolidated debt figure provides investors with visibility into the company's total leverage position following the transaction close and the associated financing activities.

The company did not disclose its consolidated debt balance immediately prior to these borrowings, making it impossible to calculate the precise increase in leverage attributable to the acquisition financing. Additionally, the filing does not provide pro forma leverage ratios, interest coverage metrics, or other financial metrics that would allow investors to assess the impact of this debt increase relative to Novanta's operating performance or cash flow generation. Pro forma financial information, which would include these forward-looking metrics incorporating the acquired business, is required to be filed within 71 calendar days of this disclosure.

Conditions and Customary Adjustments

The closing consideration paid at closing on July 23, 2026 is subject to customary post-closing adjustments based on the financial condition of Runway Buyer as of the closing date. These adjustments typically address working capital balances, cash levels at closing, assumed or retained debt, and transaction-related expenses incurred by the target company. The Purchase Agreement, filed as an exhibit to the June 8, 2026 disclosure, contains the detailed mechanics for calculating these adjustments, but the specific adjustment methodology is not reprised in this current filing.

The filing states that the description of the Purchase Agreement and transaction terms provided in the June 8, 2026 disclosure is incorporated by reference into this announcement, effectively making the full transaction agreement available for review by investors and market participants. This incorporation by reference approach is standard in acquisition disclosures and allows the company to avoid duplicating lengthy contractual language in multiple filings.

Regulatory Treatment and Future Disclosure Obligations

The company has indicated that audited financial statements of Runway Buyer and pro forma financial information required by Item 9.01 of the Form 8-K will be filed as an amendment to this current report no later than 71 calendar days after the filing date. This timeline, extending to approximately early September 2026, allows the company time to obtain audited financial statements from the acquired business and prepare combined pro forma statements showing the effect of the acquisition on Novanta's financial position and results of operations. These future filings will provide material information about the acquired business's historical financial performance and its projected impact on Novanta's consolidated financials.

The announcement notes that certain exhibits to the current report, including the press release issued on July 27, 2026, are furnished for informational purposes and will not be deemed "filed" under Securities Exchange Act provisions or incorporated by reference into future securities offerings. This treatment limits potential liability under Section 18 of the Exchange Act for statements contained in the exhibit. The company signed this disclosure on July 27, 2026, indicating the official announcement date of the completed transaction.

Strategic Timing and Market Context

Novanta announced the completion of this $1.2 billion acquisition through a press release issued on July 27, 2026, four days after the transaction closed on July 23, 2026. The timing of the public announcement relative to the closing suggests standard corporate practice of coordinating the formal announcement with market conditions and internal communication protocols. The company's decision to execute and complete this transaction in late July 2026 occurred within a specific market environment and business context that investors may wish to monitor for implications regarding management's capital allocation priorities and confidence in the combined entity's prospects.

The filing does not contain forward-looking guidance regarding the acquired business's expected financial contribution, integration plans, or synergy expectations. The company's management commentary regarding strategic rationale, competitive positioning, or operational benefits from the acquisition is similarly absent from this disclosure, which focuses on the mechanical and financial aspects of the transaction completion. Investors seeking color on management's strategic vision for the acquisition may need to reference the press release issued on July 27, 2026, or subsequent earnings calls and investor communications.

Integration and Operational Transition

The filing structure indicates that Runway Buyer was acquired as a limited liability company entity, with all interests in the company transferred to Novanta Medical Technologies Corp. at closing. This acquisition approach, acquiring the entire entity rather than specific assets, suggests that Novanta intends to maintain Runway Buyer as a distinct operating subsidiary within its corporate structure, at least in the near term. The use of holding company structures and intermediate parent entities in the transaction—including Novanta Corporation as the intermediate parent that borrowed the acquisition financing—is typical in leveraged transactions designed to ring-fence debt obligations and manage tax or operational considerations.

Novanta's integration of the acquired business into its existing operations and potential organizational restructuring are not addressed in this disclosure. Investors will likely receive additional information regarding integration progress, management appointments, and operational changes through future earnings announcements, investor conference presentations, or supplemental regulatory filings. The company's historical practice in prior acquisitions, if any, may provide guidance regarding the expected timeline and nature of integration activities.

Credit Facility Terms and Future Refinancing Considerations

The Fourth Amended and Restated Credit Agreement governs both the revolving credit facility and the delayed draw term loan facility that funded the acquisition. The June 2030 maturity date provides a four-year window for the company to manage the refinancing of this debt or to generate sufficient cash flow to repay the borrowed amounts. The filing notes that borrowings may be repaid at any time without prepayment penalty, suggesting a relatively borrower-friendly structure without make-whole or other redemption premiums that might discourage early repayment.

The interest rate, fees, financial covenants, and other material terms of the Fourth Amended and Restated Credit Agreement are not disclosed in this filing. Investors seeking details regarding the cost of debt, leverage covenants, or restrictions on Novanta's financial and operational flexibility may need to reference prior credit agreement filings or the company's publicly available debt disclosures. The specific drawdown amounts under the revolving facility versus the delayed draw term loan facility are also not separately identified in this announcement.