L-3 Communications announced Dec. 8 that it has entered into a definitive agreement to sell its National Security Solutions (NSS) business to CACI International Inc. for $550 million in cash.
“The NSS acquisition strongly reinforces our strategic growth plan. I am confident the complementary, high-end solutions gained will strengthen our competitive position. This transaction adds depth and breadth to our intelligence, cyber, and C4 solutions and services to meet our nations’ evolving and most critical national security challenges. We welcome the highly skilled, experienced, and exceptionally talented NSS employees to CACI,” said CACI President and CEO, Ken Asbury.
“L-3 is in the midst of a business transformation aimed at reshaping our portfolio, strengthening our focus on markets where we have leading positions, and improving our top-line growth and margin profile,” L-3’s Chairman and CEO Michael T. Strianese said. “The sale of L-3 NSS to CACI aligns directly with this commitment and further sharpens our focus on our higher-returning defense electronics, communications and ISR businesses. The proceeds from the sale will provide L-3 with additional flexibility to continue focusing on a disciplined and balanced capital allocation strategy to drive shareholder value and enhance the market-leading products and systems we provide to our customers.
“We also continue to evaluate our portfolio for additional actions that will enable us to improve L-3’s business profile and provide us with the best opportunity to improve the organic sales growth and margin outlook of our business,” Strianese said.
The transaction is anticipated to be completed by March 2016. The NSS results of operations are expected to be reported as discontinued operations beginning in the fourth quarter of 2015.
Deutsche Bank Securities Inc. served as financial advisor to L-3 in connection with the transaction. Simpson Thacher & Bartlett LLP served as legal advisor to L-3.