Digi International (NASDAQ:DGII) said it has agreed to acquire Oslo, Norway-based wireless sensing company Disruptive Technologies, a transaction the company expects to close following regulatory approval before the end of calendar 2026.
Chief Executive Officer Ron Konezny said Disruptive Technologies, founded in 2013 and led by Erik Fossum Færevaag, has developed proprietary sensing technology designed for low-power operation and small form factors. The company has designed its own application-specific integrated circuit, or ASIC, and wireless protocol rather than relying on off-the-shelf components, according to Konezny.
SmartSense Integration Plans
Following closing, Digi plans to integrate Disruptive Technologies into its SmartSense business, with results reported in Digi’s IoT Solutions segment. The companies’ technology, processes, organizations and go-to-market operations are expected to be combined.
Digi intends to shift Disruptive Technologies’ existing model of one-time sensor sales plus separate software subscriptions toward SmartSense’s model of combining sensors and software into a single subscription. Konezny said SmartSense’s analytics and artificial intelligence capabilities, combined with Disruptive Technologies’ broader sensing portfolio, are expected to give customers more data while simplifying deployment, scaling and maintenance.
“You are buying a SmartSense solution, of which Disruptive Technologies will be a key part of powering that solution,” Konezny said during the call.
Konezny said the combination creates three primary growth avenues:
- Expanding more rapidly together in North America, where Digi has its largest footprint;
- Extending SmartSense into Europe through Disruptive Technologies’ existing country-by-country relationships; and
- Entering building automation and occupancy markets through additional sensor types, including motion, tactile and CO2 sensors.
Disruptive Technologies currently participates mainly in traditional office environments and, to a lesser extent, manufacturing, Konezny said.
Financial Details and Expected Benefits
Chief Financial Officer Jamie Loch said Disruptive Technologies generated $15 million in revenue and $4 million in annual recurring revenue, or ARR, during calendar 2025. Konezny said the business has been growing at a rate “well into double digits,” though its revenue mix has been more heavily weighted toward one-time sensor sales.
Loch said Digi will fund the transaction through its existing credit facility and continue its stated approach of using cash generation to reduce debt while investing in growth. Based on Digi’s updated fiscal 2026 guidance issued Aug. 5, the transaction would add less than one times leverage to the company’s gross outstanding debt balance, he said.
Digi expects fiscal 2027 to focus on integrating teams, systems, manufacturing, technology and channel relationships. Loch said the company expects the integration to deliver an incremental $9 million of adjusted EBITDA and free cash flow in fiscal 2028.
On the expected composition of those benefits, Loch said the opportunity “probably scales a little bit more to the cost side,” citing economies of scale in research and development, manufacturing and go-to-market operations. He also said Digi sees potential revenue synergies from combining the businesses.
When asked about the transaction’s expected earnings impact in fiscal 2027, Loch declined to provide detailed guidance but said it would be accretive at the earnings-per-share line.
Konezny characterized the planned acquisition as Digi’s second acquisition involving the SmartSense team within 18 months, describing it as further evidence of the company’s investment in a market it believes remains in the early stages of development.
About Digi International (NASDAQ:DGII)
Digi International Inc (NASDAQ: DGII) provides business and industrial Internet of Things (IoT) connectivity products and solutions. The company helps organizations connect, monitor and manage equipment, sensors and other devices over cellular, wireless and wired networks.
Its product portfolio includes industrial routers and gateways, embedded systems and wireless modules, console servers, serial connectivity products and infrastructure for machine-to-machine communications. Digi also offers cloud-based device management and monitoring through Digi Remote Manager, along with professional services and support designed to help customers deploy and maintain connected devices.
Digi’s solutions are used across industries such as transportation, energy, healthcare, manufacturing, retail, government and commercial services.
