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L-3 Communications (LLL) to Buy Australia-Based Micreo
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L-3 Communications Holdings Inc. has entered into an agreement to purchase Micreo Limited, a specialized Electronic Warfare subsystems provider based in Brisbane, Australia.
Details of the Transaction
The deal is projected to be complete by the end of this month, subject to certain closing conditions. Financial terms of the acquisition were, however, not disclosed by the company.
Post the acquisition, Micreo will be integrated into the company’s Electronic Systems segment and will thereafter be known as L-3 Micreo.
Impact on Financials
It has been estimated that by 2017 end, Micreo will contribute $27 million in revenues, thereby providing accretion to L-3 Communications’ bottom line.
Benefits of the Deal
Micreo specializes in solutions that employ high-performance microwave, millimeter wave and photonic technology. Its business line should align perfectly with L-3 Communications’ wide range of sensors. Micreo’s products are market-ready for ISR and EW use, and presently support a wide range of airborne, land and security programs in the country. Hence, a merger with Micreo will support the development of products in a higher EW RF bandwidth at L-3 Communications.
Additionally, Micreo has counter-IED capabilities that will bolster L-3 Communications’ existing line of man-portable and vehicle electronic counter measures (ECM) equipment.
According to Michael T. Strianese, L-3 Communications’ Chairman and Chief Executive Officer, the acquisition will allow Micreo to enhance its technical expertise and offerings. The transaction will help accelerate growth in L-3 Communications’ international business, while creating cross-selling opportunities in key markets.
Moreover, the merger will boost L-3 Communications’ core business in Australia, supporting many of its segments. Micreo will also “add new in-country resources” for the company’s growing customer base in the country as well as in the Asia-Pacific region.
Zacks Rank & Key Picks
L-3 Communications currently has a Zacks Rank #3 (Hold). A few better-ranked stocks in the aerospace and defense space include Engility Holdings, Inc. , General Dynamics Corporation (GD - Free Report) and Leidos Holdings, Inc. (LDOS - Free Report) . While Engility Holdings sports a Zacks Rank #1 (Strong Buy), both General Dynamics and Leidos carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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L-3 Communications (LLL) to Buy Australia-Based Micreo
L-3 Communications Holdings Inc. has entered into an agreement to purchase Micreo Limited, a specialized Electronic Warfare subsystems provider based in Brisbane, Australia.
Details of the Transaction
The deal is projected to be complete by the end of this month, subject to certain closing conditions. Financial terms of the acquisition were, however, not disclosed by the company.
Post the acquisition, Micreo will be integrated into the company’s Electronic Systems segment and will thereafter be known as L-3 Micreo.
Impact on Financials
It has been estimated that by 2017 end, Micreo will contribute $27 million in revenues, thereby providing accretion to L-3 Communications’ bottom line.
Benefits of the Deal
Micreo specializes in solutions that employ high-performance microwave, millimeter wave and photonic technology. Its business line should align perfectly with L-3 Communications’ wide range of sensors. Micreo’s products are market-ready for ISR and EW use, and presently support a wide range of airborne, land and security programs in the country. Hence, a merger with Micreo will support the development of products in a higher EW RF bandwidth at L-3 Communications.
Additionally, Micreo has counter-IED capabilities that will bolster L-3 Communications’ existing line of man-portable and vehicle electronic counter measures (ECM) equipment.
L-3 COMM HLDGS Price
L-3 COMM HLDGS Price | L-3 COMM HLDGS Quote
L-3’s Take on the Deal
According to Michael T. Strianese, L-3 Communications’ Chairman and Chief Executive Officer, the acquisition will allow Micreo to enhance its technical expertise and offerings. The transaction will help accelerate growth in L-3 Communications’ international business, while creating cross-selling opportunities in key markets.
Moreover, the merger will boost L-3 Communications’ core business in Australia, supporting many of its segments. Micreo will also “add new in-country resources” for the company’s growing customer base in the country as well as in the Asia-Pacific region.
Zacks Rank & Key Picks
L-3 Communications currently has a Zacks Rank #3 (Hold). A few better-ranked stocks in the aerospace and defense space include Engility Holdings, Inc. , General Dynamics Corporation (GD - Free Report) and Leidos Holdings, Inc. (LDOS - Free Report) . While Engility Holdings sports a Zacks Rank #1 (Strong Buy), both General Dynamics and Leidos carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>