(Bloomberg) — Viasat Inc. shares jumped after L3Harris Technologies Inc. agreed to buy its tactical data links division for about $1.96 billion to beef up its military communications business.
(Bloomberg) — Viasat Inc. shares jumped after L3Harris Technologies Inc. agreed to buy its tactical data links division for about $1.96 billion to beef up its military communications business.
The Viasat unit has 450 employees and generates about $400 million in annual sales, the companies said Monday. The deal is expected to close in the first half of 2023.
The business provides encryption technology, an area that’s growing in importance as cybersecurity becomes a new frontier for geopolitical conflict. The acquisition could help L3Harris compete with larger Pentagon suppliers such as Raytheon Technologies Corp. and Lockheed Martin Corp.
“Global national security requirements are increasing rapidly in this sector,” L3Harris Chief Executive Officer Christopher Kubasik said in a statement.
Viasat, a geostationary satellite company, had been exploring a sale of the unit, Bloomberg reported in July. The company expects about $1.8 billion in cash proceeds from the deal and plans to use that to pay down debt.
Viasat’s shares rose as much as 27%, their biggest intraday gain since March 2020, in New York trading. L3Harris climbed as much as 2.6%.
(Updates with L3Harris comment in fourth paragraph, proceeds in fifth and shares in sixth.)
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