L-3 to Acquire Westwood Corporation
L-3 Communications announced that it has entered into a definitive agreement to acquire all outstanding shares of common stock of Westwood Corporation, a leader in shipboard power control, switchgear and power distribution systems, for $2.30 per share in cash. The total value of the transaction is approximately $22 million, plus assumed debt. The transaction is subject to customary closing conditions, including approval by Westwood's stockholders, and is expected to close by the end of this year. The acquisition is expected to be slightly accretive to L-3's earnings.
With headquarters in Tulsa, Oklahoma, Westwood is the premier niche provider of shipboard power distribution, machinery and automation systems to the United States Navy, Army, Air Force and Coast Guard. Westwood provides control switchgear to the United States Navy's LPD-17 and DDG-51 vessels as well as portable power generators to the Army's Communications-Electronics Command (CECOM) organization. For its 2002 fiscal year ended March 31, 2002, Westwood reported strong operating results, with revenues growing 71 percent to $52.1 million, and EBITDA and net income of $2.7 million and $1.0 million, respectively.
"This acquisition broadens L-3 Communications' capabilities and market share for future power distribution and switching, and establishes the company as the major provider of all the control switchgear to the LPD-17 class of ships," said Frank C. Lanza, chairman and chief executive officer of L-3 Communications.
"Westwood products can be found on every ship in the Navy's active surface fleet and this acquisition is very synergistic with our SPD Technologies businesses, including EDI and Henschel, in technology marketing and customers," continued Mr. Lanza. "With a highly experienced technical staff that provides innovative, COTS-based solutions to its customers, Westwood will enable L-3 to gain a stronger market position in the maritime shipboard control and switchgear market as well as enable us to expand our power product offerings to the Army and other military organizations."