SpeedCast International Limited completed the acquisition of Harris CapRock Communications, Inc. from Harris Corporation.
January 01, 2017
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SpeedCast International Limited (ASX:SDA) entered into a definitive agreement to acquire Harris CapRock Communications, Inc. from Harris Corporation (NYSE:HRS) for approximately $430 million on November 1, 2016. The purchase price is subject to customary closing adjustments. The acquisition will be funded via a fully underwritten AUD 295 million ($223.8 million) Accelerated Renounceable Entitlement Offer of SpeedCast International Limited shares, with the balance to be funded by a fully-underwritten syndicated debt facility for $385 million. The transaction represents an implied transaction multiple of 7.0x Jun-16 EV / EBITDA. For the year ended on June 30, 2016, Harris CapRock Communications, Inc. recorded revenue of $363 million and EBITDA of $60 million. The deal is subject to customary closing conditions, including anti-trust and regulatory approval and is expected to close in first quarter of 2017. On November 28, 2016, the transaction received early termination notice from FTC.
Proceeds from the transaction will be used to pay down debt and return cash to shareholders. The transaction is expected to be earnings per share accretive in 2017. Credit Suisse and ING acted as financial advisors while Benton Brooks Bodamer, Daniel Karelitz, Milena Tantcheva, Richard Matheny, Albert Solecki and Scott Webster of Goodwin Procter LLP acted as legal advisor for SpeedCast International Limited. Richard Kriedemann, Robert Pick, Senior Associate Addison Ma and lawyer Melanie Hayden of Allens, Corrs Chambers Westgarth and DLA Piper acted as Australian counsel on the financing for SpeedCast International Limited. Matt Petersen, Courtney Murray, Peter Teare, James Tandler, Morley Fortier, Patrick O'Malley and Priscilla Arthus of Reed Smith LLP acted as legal advisor for Harris Corporation. Brendan Panda, Slava Brin, Katherine Rossolimo, Adriana Salazar, Michael Gugino, Josh Rosenberg and Michael Aaronson of Evercore acted as financial advisor for Harris Corporation. All conversions are made through www.oanda.com as on November 1, 2016.
SpeedCast International Limited (ASX:SDA) completed the acquisition of Harris CapRock Communications, Inc. from Harris Corporation (NYSE:HRS) on January 1, 2017.
L3Harris Technologies, Inc. specializes in the design, manufacturing and marketing of information and communication equipment for the defense, government agency, and commercial structure markets. Net sales break down by family of products as follows:
- integrated mission systems (32.4%): intelligence, surveillance and reconnaissance systems, communication systems, electrical and electronic systems for marine platforms, advanced electro-optical and infrared solutions, etc. ;
- space and airborne systems (28.3%): payload systems, sensors, complete mission solutions, confidential intelligence systems, cyber defense solutions, electronic warfare systems, etc;
- communication systems (23.8%): tactical communication systems, broadband communications, integrated visual communications solutions, etc;
- aviation systems (15.5%): air defense systems, commercial aircraft equipment, pilot training solutions and air traffic management systems.
Net sales break down by source of income between sales of products (78.9%) and services (26.1%).
The United States account for 90.2% of net sales.
L3HARRIS TECHNOLOGIES, INC. 
