US aerospace and defence firm Rockwell Collins has sold its military ground-based satellite communications portfolio to an undisclosed private investor in Atlanta.
The sale includes about 365 employees and operations in the US and Sweden, and comes as…
US aerospace and defence firm Rockwell Collins has sold its military ground-based satellite communications portfolio to an undisclosed private investor in Atlanta.
The sale includes about 365 employees and operations in the US and Sweden, and comes as the group reduces its reliance on government contracts in response to ongoing budget cuts.
Rockwell Collins Satellite Communications Systems, which will be renamed DataPath after being sold for an undisclosed sum, designs, manufactures and services ground-based satcoms systems primarily for the military.
“This transaction is part of a strategy to reshape our government systems portfolio to align with the changing dynamics of the defence environment, and focus on core products that will fuel future growth for the company,” said Rockwell Collins CEO Kelly Ortberg.
Ortberg took the helm in August and has set out ambitions to accelerate the company’s growth through acquisitions. Soon after his appointment, the group announced plans to buy aviation communications specialist Arinc from private equity firm Carlyle for roughly US$1.39bn in cash.
Rockwell said Arinc would improve its position in the fast-growing aviation information management space, bolstering connectivity solutions for aircraft through the use of satellite and air-to-ground networks.
The deal, which was fully funded by a debt facility from its financial adviser Citigroup, also shifted the balance of Rockewell’s business to around 54% commercial and 46% government.
The company last week posted Q3 sales up 12% to US$1.26bn compared with the corresponding period in 2013, primarily due to the Arinc transaction. Operating earnings for the quarter increased US$6m to US$263m.
“This was another strong quarter for Rockwell Collins and demonstrates we are on a path to accelerating growth and increasing shareowner value,” said Ortberg.