Novanta today announced that it has agreed to acquire ATI Industrial Automation for $172 million in cash.

Bedford, Mass.–based Novanta plans to acquire the OEM surgical robotics supplier for $172 million upfront in cash and additional contingent cash payments associated with company financial performance in 2021. The company will also grant performance stock units.

ATI develops and manufactures robotic changing systems, force-torque sensors and collision sensors for industrial collaborative and medical robotic applications.

“ATI is a fantastic business with proprietary intellectual property in attractive and growing markets. The business adds intelligent technology solutions and expands Novanta’s position in mission-critical robotic applications, such as electric vehicle production, medical robotics, and collaborative robotics,” Novanta CEO Matthijs Glastra said in a news release. “In addition, the transaction creates a nearly $250 million Precision Motion Segment with significant engineering competency to further accelerate our growth.”

The transaction is subject to customary closing conditions, including regulatory approvals, and will be financed using available cash and Novanta’s revolving credit facility. The deal is expected to close in the third quarter of this year.

“We are excited to join Novanta at this stage of our development. We expect the combination of competencies and cultures to create better opportunities for our customers and employees,” ATI CEO Bob Little said. “We feel confident our shared values, our passion for innovation, and our deep application knowledge will create stronger partnerships with our customers to help us accelerate our strategic goals.”