The Boeing Company and Argon ST on June 30 announced that they have entered into an agreement for Boeing's acquisition of Argon ST in an all cash tender offer and merger for $34.50 per share, or approximately $775 million, net of cash acquired.
The agreement to acquire Argon ST, a leading developer of command, control, communications, computers, intelligence, surveillance, and reconnaissance (C4ISR) and combat systems, advances Boeing's growth strategy and expands the company's capabilities to address the C4ISR, cyber and intelligence markets.
"Combining the strength of Boeing with the experience of Argon ST will significantly accelerate our capabilities in sensors, communications technologies and information management," said Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security. "Today's announcement follows two years of partnering with Argon ST's talented employees who, like Boeing employees, take pride in developing and deploying world-class engineering solutions for our customers."
Founded in 1997 and headquartered in Fairfax, Va., Argon ST develops sensors and networks designed to exploit, analyze and deliver information for real-time situational awareness. In fiscal 2009, the company generated $366 million in revenues. Argon ST has operating locations in Virginia, California, Michigan, Pennsylvania, Florida, Maryland and Texas, and has approximately 1,000 employees.
"We're very pleased to join The Boeing Company," said Terry Collins, chairman and chief executive officer of Argon ST. "Our employee teams know each other well, and we are excited to now continue our combined support to warfighters and first responders as one company."
Once acquired, Argon ST will be a stand-alone subsidiary of Boeing and a new division of Boeing Network & Space Systems, a business within the Boeing Defense, Space & Security operating unit. Argon ST will continue to be led by Collins and his management team, which will help ensure a seamless transition for employees and customers.
"As part of Boeing, Argon ST will continue to provide leading-edge network-based communications solutions for domestic and international customers including the U.S. Navy, the U.S. Air Force and the Department of Homeland Security so they can continue to execute their critical missions," said Roger Krone, president of Boeing Network & Space Systems. "We're confident that this combined team will be able to achieve great things together in the future."
The transaction is expected to close by the end of the third quarter 2010. The completion of the transaction is subject to a majority of the outstanding Argon ST shares being tendered, as well as satisfactory completion of other customary closing conditions, including U.S. regulatory approval.
The definitive agreement was unanimously approved by Argon ST's board of directors, and Argon ST's board intends to recommend that the company's stockholders tender their shares in the offer.
Boeing plans to fund the transaction with existing cash. The acquisition is expected to have an immaterial impact on Boeing's earnings.
A unit of The Boeing Company, Boeing Defense, Space & Security is one of the world's largest defense, space and security businesses specializing in innovative and capabilities-driven customer solutions, and the world's largest and most versatile manufacturer of military aircraft. Headquartered in St. Louis, Boeing Defense, Space & Security is a $34 billion business with 68,000 employees worldwide.
