L-3 Buys Northrop Grumman’s Electro-Optical Group
L-3 Communications has moved to buy Northrop Grumman’s Electro-Optical Systems (EOS) business for $175 million in cash. L-3 currently offers EO/IR (electro-optical/infrared) sensors, high-definition turrets, tactical sights and laser designators for air, land and sea applications. Northrop Grumman’s EOS’ portfolio is itself the result of absorbing multiple firms and includes night vision goggles, weapons sights, driver viewers, image intensification tubes and applied optics products. The sale should be completed in the second quarter of 2008, subject to standard regulatory approvals.
L-3 EO/IR, Inc. is a division of the L-3 Communications EO/IR Group, comprising: L-3 WESCAM (Canada); L-3 Sonoma EO; L-3 EO/IR, Inc.; and L-3 Broadcast Sports, Inc. In L-3’s words, “EO/IR, Inc. acts as a contracting agency to permit a select group of important U.S. customers to contract with L-3 WESCAM via a U.S. entity. EO/IR, Inc. also deals with all export controls and licensing issues for the EO/IR Group under the direction of L-3’s Washington Office. In addition, EO/IR, Inc. facilitates the pursuit of major U.S. Defense programs for both L-3 WESCAM and L-3 Sonoma EO.”
Northrop Grumman’s EOS business is headquartered in Garland, TX, and generated approximately $190 million of sales for the year ended Dec 31/07. L-3 expects the firm to be immediately accretive to its earnings, and James W. Dunn, president of L-3’s Sensors and Simulation Group, says that “Including EOS, L-3’s EO/IR businesses will generate approximately $800 million in annual sales, with growth exceeding 10%.” L-3 release | NGC release.