Curtiss-Wright has signed on the dotted line to buy US-based tactical and enterprise communications systems provider Pacific Star Communications (PacStar) for USD 400.00 million in cash.
Following the deal, the target will operate within the acquiror’s defence segment.
Subject to regulatory approvals and closing conditions, the transaction is slated to complete during the fourth quarter of 2020.
PacStar provides tactical communications services for battlefield network management operations, including commercial off-the-shelf (COTS) small form factor systems and deployable packages to help improve combatants’ situational awareness during warfare.
Formed in 2000, the company’s software and hardware enable users to set up and manage network communications, such as secure wireless and soldier-portable devices.
PacStar has positions within several US army programmes and generates the majority of its sales from the ground defence market.
The group has 145 employees and is expected to post sales of more than USD 120.00 million in 2020.
David Adams, chief executive of the buyer, said: “The acquisition of PacStar establishes Curtiss-Wright as a critical supplier of advanced tactical and enterprise network communications solutions supporting a broad spectrum of high-priority US military force modernisation programmes.
“Further, this acquisition supports Curtiss-Wright’s financial objectives for long-term profitable growth and strong free cash flow generation within our disciplined and balanced capital allocation strategy.”
The combination of the two companies’ COTS-based technology and hardware and software operations will also allow the buyer to deliver platform network integration and tactical data link network management services to its warfighters.
Curtiss-Wright expects the transaction to increase its earnings per share in the first full year following closing.
According to Zephyr, the M&A database published by Bureau van Dijk, the deal represents the buyer’s largest acquisition to date.
Prior to this transaction, Curtiss-Wright snapped up US-based aircraft systems manufacturer Teletronics Technology for USD 233.00 million in March 2017.
© Zephus Ltd