DRS gets $5.2b offer from Italy's Finmeccanica
ROME--Finmeccanica, a supplier of electronics equipment and defense and security systems and services based here, has announced its intent to acquire a 100 percent stake in DRS Technologies, a Parsippany, N.J.-based supplier of integrated defense electronics products, services and support, for $81 per share or a total of $5.2 billion, inclusive of approximately $1.2 billion in net debt.
DRS generated $2.8 billion in revenue in 2007 and the offer represents a 32 percent premium over the 30-day average of the company's stock price on the New York Stock Exchange.
The deal will allow Finmeccanica to establish a foothold on the U.S. market and consolidate its international role as a key supplier of integrated systems for defense and security.
"Today's transaction is a perfect fit; the complementary technologies and platforms will establish a new competitive player in defense and security markets in the U.S. and around the world," Finmeccanica chairman and CEO said in a statement.
The deal will also give DRS improved access to opportunities on the international market, a DRS representative said.
Under the terms of the deal, DRS will operate as a wholly owned subsidiary and maintain its current management and headquarters. In line with the expected increase in business opportunities, DRS said it expects to expand its workforce as well.
Finmeccanica already has subsidiaries in Pennsylvania, Texas, New York, California, Kansas, Virginia and North and South Carolina.
The deal is subject to approval by DRS shareholders and regulatory approval from U.S. antitrust authorities, the committee on Foreign Investment in the U.S. and the Defense Security Service. It is expected to close by the fourth quarter of 2008.