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April 14, 2014
10:02 EDTCMTLComtech awarded contracts to support Blue Force tracking program
Comtech announced that its subsidiary, Comtech Mobile Datacom Corporation, has been awarded a three-year contract to continue to provide sustainment support for the U.S. Army's Force XXI Battle Command Brigade and Below - Blue Force Tracking program. In addition, the U.S. Army agreed to continue to license certain of Comtech's intellectual property pursuant to a separate contract. Under the new three-year BFT-1 sustainment contract, which has a not-to-exceed value of $38.2M, Comtech will provide engineering services and satellite network operations on a cost-plus-fixed-fee basis and program management services on a firm-fixed-price basis. The base performance period begins April 1 and ends March 31, 2015, and the contract provides for two twelve-month option periods exercisable by the U.S. Army. The total estimated value of the base year is $13.6M. Comtech also entered into a new BFT-1 IP contract with a potential value of $30M which enables the U.S. Army to continue to license certain of Comtech’s IP. The contract requires a $10M annual license fee for a base period beginning April 1 and ending March 31, 2015 with two twelve-month option periods exercisable by the U.S. Army. If the U.S. Army exercises the two option periods and pays an aggregate of $30M of annual license fees, the U.S. Army will receive a limited non-exclusive right to use Comtech's IP after March 31, 2017 for no additional IP license fee.
News For CMTL From The Last 14 Days
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November 24, 2015
06:56 EDTCMTLTeleCommunication Systems downgraded to Market Perform at Northland
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November 23, 2015
08:04 EDTCMTLComtech CEO: TCS combination 'beneficial' to investors of both companies
08:03 EDTCMTLComtech sees TeleCommunication Systems deal accretive in first year
08:02 EDTCMTLComtech to acquire TeleCommunication Systems for $430.8M
Comtech Telecommunications Corp. (CMTL) and TeleCommunication Systems, Inc. (TSYS) jointly announced the signing of a definitive merger agreement under which Comtech will purchase TCS in a cash transaction for $5.00 per TCS share, or approximately a $430.8 million enterprise value. The $5.00 price per share represents a premium of 13.9% as compared to the last closing trading price of TCS common stock, a premium of 28.6% as compared to the volume-weighted average trading price over the last ninety trading days and a premium of 35.1% as compared to the last closing trading price one day after TCS's July 6, 2015 announcement that its Board had formed a special committee to explore strategic alternatives to enhance stockholder value. The acquisition is expected to be cash accretive in the first year of the acquisition and to result in approximately $12.0 million of synergies in the second year after closing, with approximately $8.0 million achieved in the first year after closing. Synergies are expected to be achieved by reduction of duplicate public company costs, reduced spending on maintaining multiple information technology systems and obtaining increased operating efficiencies throughout the combined company. In connection with the acquisition of TCS, Comtech expects to incur transaction related expenses including certain change-in-control payments, professional fees for financial and legal advisors and debt extinguishment costs. Comtech preliminarily estimates that these expenses will approximate $27.5 million, some of which are expected to be immediately expensed upon closing, some expensed during the first year following the closing and some capitalized in accordance with purchase accounting rules. Pursuant to accounting rules, the acquisition is expected to result in a material increase in annual amortization expense related to intangibles and possible other fair value adjustments. Comtech will provide combined revenue, Adjusted EBITDA and diluted earnings per share guidance in a future announcement. All TCS debt of approximately $143.6 million is anticipated to be repaid upon the closing of the transaction. The acquisition has a transaction equity value of approximately $339.7 million and an enterprise value of approximately $430.8 million. The purchase price of $430.8 million represents an implied transaction multiple of approximately 8.9x based on the last trailing twelve months of reported TCS Adjusted EBITDA plus approximately $8.0 million of first year identified synergies. On a pro forma basis, at the time of close, the combined company is expected to have total leverage of about 3.9x trailing twelve months combined pro forma Adjusted EBITDA. This is expected to decrease over time, based on cash flows generated from the combined businesses. The transaction is subject to customary closing conditions, including the tender of at least a majority by vote of outstanding shares of TCS common stock and expiration of the applicable waiting period under the Hart-Scott Rodino Antitrust Improvements Act of 1976, and the transaction is expected to close no later than March 2016. Maurice B. Tose, Chairman, CEO and President of TCS and Jon B. Kutler, Founder of Admiralty Partners, Inc. and a director of TCS, each a significant stockholder of TCS, have entered into support agreements pursuant to which they have agreed to tender their shares, subject to terms and conditions, to demonstrate their strong support of the proposed transaction.
08:01 EDTCMTLComtech to acquire TeleCommunication Systems for $430.8M
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07:57 EDTCMTLComtech trading halted, pending news
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