Kratos receives $11.7M contract to provide electronics U.S. ballistic missiles Kratos Defense & Security Solutions announced that its Electronic Products division has received a contract valued at $11.7M from a major prime contractor for the continuing production of electronic hardware for a critical U.S. Ballistic Missile program. The electronic products and hardware to be provided under this recent contract award will be produced in a secure Kratos manufacturing facility. No additional details are being provided due to customer and other sensitivities.
Kratos Defense completes sale of U.S., U.K. operations of EP division Kratos Defense & Security Solutions has completed the previously announced sale of the U.S. and U.K. operations of its Electronic Products Division to Ultra Electronics Holdings plc for $260 million in cash plus up to $5 million for taxes incurred as part of the transaction, less a $2.0 million escrow to satisfy any purchase price adjustments and a working capital adjustment currently estimated as a net reduction of $7.6 million. The Company expects to pay $13 million in transaction-related costs and approximately $10 million in federal and state income taxes, resulting in net cash proceeds to the Company of approximately $232.4 million. Kratos currently intends to use proceeds from the Transaction to initiate a repurchase process for up to $175 million of its 7 Percent Senior Secured Notes (the "Notes") at par. In addition, Kratos has paid down all outstanding amounts on its $110 million bank credit facility, which totaled approximately $41 million. In connection with the Transaction, the Company also amended its credit facility to allow for this divestiture as well as provide a permanent reduction in the financial covenants for future periods under the credit agreement.