Lockheed Martin Corporation (LMT - Free Report) has acquired U.K. based business, Amor Group, for an undisclosed sum. This strategic move will propel Lockheed Martin into Britain's top 10 companies for IT services.
Headquartered in Glasgow, Scotland, Amor Group – which provides IT systems for the energy, public service and transport sectors – has over 500 employees across seven facilities in the U.K. This strength would extend Lockheed Martin’s expertise to important contiguous business areas like energy, government health care and airport operations.
The defense major has acquired all of Amor’s shareholders, comprising Growth Capital Partners and the management. Now, this buyout will make Amor a part of Lockheed Martin’s information systems and global solutions unit.
Amor has its existence in another 15 countries. Its distinctive transportation systems run more than 3 million aircraft movements and track 700 million passengers each year. This would complement Lockheed Martin's operations with the U.S. Federal Aviation Administration and many other international customers.
Lockheed Martin and other defense biggies are gradually looking to diversify their presence in order to generate more sales in the face of domestic budget austerities and sequestration. Acquisitions like this will enrich Lockheed’s operations while keeping the top-line growth momentum intact. The U.S. Department of Defense has already planned to slash its spending level by $500 billion over the next 10 years. This is on top of $487 billion in cuts that were already planned for roughly the same period.
Lockheed Martin is the largest defense contractor in the world. The company’s customer base includes the U.S. government, foreign governments and other commercial buyers.
The company delivered better-than-expected second quarter earnings, which surged almost 11% from the year-ago profit level. The upcast in earnings was mainly attributable to strong operational performance. This drove the management to raise its full-year EPS guidance to $9.20–9.50 from $8.80–9.10.
Lockheed Martin presently retains a short-term Zacks Rank #2 (Buy). Other better-placed operators include Northrop Grumman Corp. (NOC - Free Report) , Alliant Techsystems Inc. and B/E Aerospace Inc. . While Alliant Techsystems carries a Zacks Rank #1 (Strong Buy), Northrop and B/E Aerospace hold a Zacks Rank #2 (Buy).