(Wall St. Journal, Bloomberg, WXXI News) Two companies which have a large presence in Rochester will now have something else in common. On Friday, it was announced Harris Corp. agreed to buy Exelis Inc. in a transaction with an enterprise value of $4.75 billion as the telecommunications-equipment maker expands into aerospace systems.
Harris is offering $23.75 a share for Exelis, including almost $16.63 apiece in cash and 0.1025 of a share in Harris stock, the companies said in a statement. Investors in Melbourne, Florida-based Harris will own 85 percent of the combined company and shareholders of McLean, Virginia-based Exelis will own the remainder.
“The combination of the two companies’ highly complementary core franchises creates a competitively stronger company with significantly greater scale,” Harris Chief Executive Officer William Brown said in the statement.
Harris’s divisions include the RF Commnications unit, which has a number of employees in Rochester. And Exelis’ Geospatial Systems division, which is involved in aerospace and defense work, is headquartered in Rochester.
Harris employs about 2500 people in Rochester, Exelis around 1300. Harris' CEO William Brown told both Senator Charles Schumer and Congresswoman Louise Slaughter that he does not anticipate this deal will mean any job loss in Rochester.
The deal unveiled Friday comes as defense contractors such as Harris, a communications-equipment producer, contend with a squeeze on U.S. defense funding. The Defense Department earlier this week proposed a spending plan that would ignore spending caps that have been put in place by Congress.
On Friday, meanwhile, Harris posted a fifth-consecutive quarter of revenue growth from the government sector.
