L-3 Communications [LLL] yesterday said it has agreed to acquire the Kollmorgen Electro-Optical (KEO) unit of Danaher Corp. [DHR] for $210 million in cash, giving it new capabilities in electro-optics and infrared technology and products, a key growth area for the company.
KEO designs and manufactures periscope and optronic mast systems for submarines, and also makes ship fire control systems, visual landing aids, ground electro-optical and sensor cueing systems.
“KEO’s unique and proprietary systems support high-priority DoD programs, expand our existing product portfolio and create a variety of technical synergies and product pull-through opportunities that are applicable across L-3,” Michael Strianese, L-3’s chairman, president and CEO, said in a statement.
L-3 said the purchase would immediately be accretive to its operating results.
KEO, which is based in Massachusetts and has operations in Italy, employs 550 people and is expected to have sales next year between $160 million and $170 million. Danaher said that KEO had $169 million in sales in 2010. KEO’s earnings before interest, taxes, depreciation and amortization next year is expected to be between $26 million and $30 million.
The acquisition is expected to close in the first quarter of 2012 subject to regulatory approvals. KEO will become part of L-3’s Integrated Sensor Systems organization within the Electronic Systems segment.