L-3 Agrees to Acquire Kollmorgen Electro-Optical for $210M

L-3 Communications LLL announced today that it has entered into an agreement to acquire the Kollmorgen Electro-Optical (KEO) unit of Danaher Corporation. KEO develops and manufactures specialized equipment, including submarine photonics systems and periscopes, ship fire control systems, visual landing aids, ground electro-optical and sensor-cueing systems. Headquartered in Northampton, Mass., and with facilities in Bologna, Italy, KEO employs approximately 550 people. KEO's products are used by the U.S. military, prime contractors and allied nations. The purchase price is $210 million and will be funded with cash on hand. The acquisition is anticipated to be completed in the first quarter of 2012, subject to customary closing conditions and regulatory approvals, and will be structured as an asset purchase for income tax purposes. For the year ending December 31, 2012, KEO is expected to generate sales in the range of approximately $160 million to $170 million, and estimated earnings before interest, taxes, depreciation and amortization before giving effect to the expected synergies, transaction costs, and purchase accounting adjustments (EBITDA) in the range of $26 million to $30 million. Upon closing, the acquisition is expected to be immediately accretive to L-3's results of operations.