Harris acquires Exelis for $4.75bn


Harris has acquired US-based aerospace, defence, information and services company, Exelis, in a cash-and-stock deal valued at approximately $4.75bn.

Under the deal, Exelis shareholders converted each of their shares into $16.625 in cash, and 0.1025 shares of Harris common stock, leaving the latter's shareholders with 85% ownership. Exelis shareholders now own 15% of the combined company.

Harris chairman, president and chief executive officer William Brown said: "The Exelis acquisition is transformative for our company and marks a major milestone in Harris's 120-year history.

"With about $8bn in combined pro forma revenue, the acquisition creates significantly greater scale, bringing together two engineering-driven companies and workforces with similar cultures that value technology leadership.

"Together, the two companies' complementary technologies and capabilities strengthen core franchises and provide new opportunities for innovation to solve our customers most complex challenges."

"With about $8bn in combined pro forma revenue, the acquisition creates significantly greater scale, bringing together two engineering-driven companies and workforces."

The completion of transaction follows the merger agreement approval by Exelis shareholders, and termination of the Hart-Scott-Rodino waiting period by the US Department of Justice.

According to Harris, the transaction is expected to be slightly accretive on a generally accepted accounting principles (GAAP) basis in the first full year, and a significant contributor thereafter.

Currently executing its detailed integration plan to provide significant and lasting value for all stakeholders, the company expects to provide 2016 guidance on this year's fourth quarter earnings call.

On a pro forma basis for the year ending December 2014, the combined company reported more than $8bn in revenue, as well as 23,000 employees globally, including 9,000 engineers and scientists.

Exelis manufactures electronic warfare systems, navigation equipment, air traffic management, and communications systems for defence and aerospace sectors.

Headquartered in Florida, US, Harris supplies tactical radios to US and allied forces.