Mercury Computer Systems [MRCY] this month acquired LNX Corp., a developer and producer of defense electronics components used in intelligence gathering platforms, for $31 million in cash.
Terms of the deal include an additional $5 million earn-out provision based on financial results this year and next.
For Mercury, which is a subsystems provider in the area of technology used for intelligence, surveillance and reconnaissance (ISR), the deal bolsters its electronic warfare (EW) capabilities and boosts its content on the Navy’s Joint Counter Radio-Controlled Improvised Explosive Device Electronic Warfare (JCREW) 3.3 program, a jamming system that can by carried by troops, mounted on a vehicle or vessel, or used in a fixed location to prevent radio-controlled improvised explosive devices from being detonated.
LNX, which is based in New Hampshire, designs and builds radio frequency receivers for ISR and electronic attack applications.
Mercury said the acquisition means it now provides the core radio frequency and signal processing for the JCREW 3.3 system, which may be the company’s largest program given that it boosts its content by more than 40 percent.
“LNX is well-aligned with Mercury in terms of capitalizing on our existing program presence while providing capabilities that will become the standard-bearer for the EW systems we intend to target in the coming years,” Mark Aslett, Mercury’s president and CEO, said in a statement. “LNX is on a strong growth trajectory, which is a credit to its technological capabilities and unique program presence. In addition, the acquisition of LNX combined with our Echotek Product Group, a leader in digital receivers previously acquired by Mercury, paves the way for Mercury to develop a new generation of software-defined subsystems designed to detect, intercept and defeat current and next generation signals of interest on land, at sea and in the air.”
Mercury is combining LNX’s operations with its Echotek Product Group to form the new Microwave and Digital Solutions group, which will specialize in the development of radio frequency and mixed-signal application-ready subsystems and components for EW and signals intelligence customers.