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L-3 Signs Agreement to Acquire Titan Corporation
L-3 Communications announced today that it has signed a definitive agreement to acquire The Titan Corporation ("Titan") under which Titan's shareholders would receive $23.10 in cash per share of Titan common stock. The total transaction value on the completion date of the acquisition is expected to be approximately $2.65 billion, including assumed debt. Titan's Board of Directors is unanimously recommending that Titan's shareholders approve the transaction.
Headquartered in San Diego, Titan is a leading provider of comprehensive national security solutions including information and communications systems solutions and services to the Department of Defense (DoD), intelligence agencies, the Department of Homeland Security (DHS) and other United States federal government customers. Titan offers services, systems and products for Command, Control, Communications, Intelligence, Surveillance and Reconnaissance (C3ISR), enterprise information technology and homeland security programs. Titan has approximately 12,000 employees, including over 9,000 personnel with U.S. Government security clearances.
The transaction is expected to close in the second half of 2005, pending the satisfaction of certain closing conditions, including a majority of Titan's shareholders voting in favor of the transaction, the execution and court filing of definitive settlements of the lawsuits described below and customary regulatory approvals. The acquisition is expected to add approximately $2.7 billion of sales and $0.25 of diluted earnings per share to L-3's results of operations for the year ending December 31, 2006.
L-3 plans to finance the transaction with a combination of available cash, borrowings under its existing revolving credit facility, and the issuance of new debt securities. L-3 has obtained commitments for $2.0 billion of interim debt financing which, in addition to its cash on hand and available revolving credit, will be sufficient, if needed, to complete the acquisition prior to issuing the new debt securities.
Simultaneously with the execution of the acquisition agreement, Titan has entered into memoranda of understanding to settle securities law class actions and derivative suits pending in both Federal and State courts in California and the Delaware Court of Chancery.
