Raytheon to Acquire Applied Signal Technology for $490 Million
Raytheon Company of Waltham, Mass., said today it has signed a definitive acquisition agreement with Applied Signal Technology, Inc., which specializes in the collection and processing of communications signals to support tactical and strategic intelligence missions. The agreement has been approved by the boards of directors of both companies.
The proposed Raytheon tender offer includes the cash purchase all outstanding common shares of Applied Signal Technology at $38.00 per share, for an aggregate purchase price of approximately $490 million. The transaction is expected to close in the first quarter of 2011 pending completion of the offer and subject o customary closing conditions and regulatory approvals. Raytheon said the transaction is not expected to have a material effect on its earnings.
Applied Signal’s tactical signals and communications intelligence (SIGINT/COMINT) systems, data fusion and information operations/information assurance products, combined with Raytheon’s world class sensor technology, program management, mission support and system integration capabilities, will provide highly discriminating solutions to an expanded range of intelligence and defense customers in the United States and around the world.
Nearly 90 percent of Applied Signal’s sales are to classified customers. The company’s portfolio includes secure broadband network communications; cyber intelligence systems, software and analytics to address sophisticated cyberspace threats; electronic warfare solutions; and other advanced capabilities that enable customers to detect, evaluate and respond to potential threats. These systems are deployed on a range of strategic platforms worldwide.
“Our history of innovation across a range of strategic and tactical ISR products and services, including significant scale in the fast-growing network intelligence space, together with Raytheon’s technology portfolio and development expertise will create strong new capabilities for customers,” said William B. Van Vleet, Chief Executive Officer, Applied Signal Technology, Inc.
Following successful completion of the transaction, Applied Signal will be integrated into Raytheon’s Space and Airborne Systems (SAS) business. Applied Signal’s capabilities offer opportunities for growth at SAS and across the Raytheon enterprise.
“Applied Signal aligns with our strategy of expanding participation in our customers’ principal areas of need, particularly ISR systems,” said Rick Yuse, president, SAS. “Joining Raytheon’s radar, electro-optical/infrared sensors, and communications technologies with Applied Signal’s SIGINT/COMINT systems will enhance our ability to deliver a full spectrum of integrated sensor solutions.”
Completion of the transaction is subject to, among other things, the valid tender of 76.3 percent of Applied Signal’s outstanding common stock, regulatory approvals and other customary closing conditions.
In the event that the minimum tender condition is not met, and in certain other circumstances, the parties have agreed to complete the transaction through a one-step merger after receipt of shareholder approval. The transaction is not subject to any financing condition.