Expanding its ship repair business to a new location, General Dynamics [GD] yesterday said it has agreed to acquire the Norfolk, Va.-based surface ship repair company Metro Machine Corp.
Terms of the deal were not disclosed. GD said the deal is expected to be accretive to earnings in 2012.
The pending acquisition, which is expected to close in November subject to regulatory approvals, gives GD’s San Diego-based NASSCO shipbuilding and repair company, a facility on the East Coast to support the Navy’s Atlantic fleet.
Metro Machine’s sole customer is the Navy and is a prime contractor for multi-ship, multi-option (MSMO) contracts for combat and support ships, including frigates, dock landing ships and amphibious transport ships. In a constrained fiscal environment the Navy is expected to extend the life of some of its ships so the acquisition of Metro Machine will give GD an opportunity for additional work here.
NASSCO, which is the largest shipbuilding and repair company on the West Coast, also has MSMO prime contracts for Navy combat and support ships, including frigates, dock landing ships, and amphibious assault ships.
Metro Machine has 400 employees. The company’s financial adviser on the deal was FIDUS Partners.
In 2011 GD expects 9 percent of its sales in its Marine Systems segment to come from ship repair work.