Cubic Global Defense accelerates portfolio
transformation and expands C4ISR offerings
Cubic Corporation (NYSE: CUB) today announced the acquisition of
TeraLogics, LLC and the signing of a definitive agreement to
acquire GATR Technologies, Inc. (GATR). The addition of TeraLogics
and GATR will enhance Cubic’s stated strategy to expand its defense
systems business by investing in a Command, Control,
Communications, Computers, Intelligence, Surveillance and
Reconnaissance (C4ISR) portfolio focused on secure and
expeditionary communications, and ISR Processing, Exploitation and
Dissemination (PED).
TeraLogics is a leading provider of real-time Full Motion Video
PED for the Department of Defense, the intelligence community and
commercial customers based in Ashburn, Virginia. The purchase price
is $39 million, including $9 million of contingent consideration,
and subject to other customary adjustments per the terms of the
stock purchase agreement.
TeraLogics’ ability to develop real-time video analysis and
delivery software for Full Motion Video is complementary to Cubic’s
existing tactical communications portfolio, and establishes Cubic
as a key player in the ISR Full Motion Video market. In addition,
TeraLogics’ current customer base extends Cubic’s customer reach
and ability to bid on new contracts and enables access to critical
Programs of Record supporting expeditionary warfare. Cubic’s
established international presence will benefit further from global
demand for TeraLogics’ products.
Cubic also entered into a definitive agreement to acquire
Huntsville, Alabama-based GATR, a manufacturer of next-generation
deployable satellite communication terminal solutions. The purchase
price is $232.5 million, including $7.5 million of contingent
consideration, and subject to customary pre- and post-close
adjustments. The closing of the GATR acquisition is subject to
regulatory approval under Hart-Scott-Rodino and is expected in
Cubic’s second fiscal quarter 2016.
GATR expands Cubic’s technology leadership in satellite
communications (SATCOM) and networking applications. GATR’s line of
portable, inflatable SATCOM and C4ISR terminals supports
mission-critical requirements for tactical communications in harsh
and forward or remote deployed environments. Its intellectual
property portfolio for its award-winning antenna solutions is a
clear differentiator and complementary to existing Cubic product
lines from the recent DTECH LABS, Inc., acquisition. The
combination of those existing products with GATR’s superior
offering will enable a broader selection for SATCOM applications
and expansion of sales to both domestic and international
customers. GATR also brings strong relationships on key Programs of
Record and contract vehicles in addition to strengthening Cubic’s
customer reach to international emergency agencies/forces with
global deployment requirements and to the overall communications
industry worldwide.
“The acquisition of TeraLogics and GATR represents powerful next
steps in achieving our C4ISR growth strategy as they expand our
footprint in the C4ISR and SATCOM markets,” said Bradley H.
Feldmann, president and chief executive officer of Cubic
Corporation. “The transformation of Cubic Global Defense Systems is
well under way with these acquisitions, coupled with the excellent
performance from DTECH, which we acquired in fiscal year 2015.
Having established a focused strategy in the C4ISR sector, we are
working aggressively to build scale with increased shareholder
returns in higher growth and higher margin markets.”
“We look forward to working with the TeraLogics and GATR
leadership teams and employees,” said Mike Twyman, executive vice
president, Communications, Intelligence and Surveillance Systems of
Cubic Global Defense. “Their collective expertise, talent and
innovative cultures will be an asset to Cubic, allowing us to
better serve our customers.”
Cubic’s investments in its C4ISR portfolio, including DTECH,
GATR, and TeraLogics, are anticipated to be accretive in fiscal
year 2017.
Cubic Corporation will conduct a conference call on January 8,
2016 at 1:00 p.m. Eastern Time, where the company’s senior
management team will make a brief presentation, followed by a
question-and-answer session.
Conference Dial-In
Information
Financial analysts and institutional investors interested in
participating in the call are invited to dial:
- 877-407-9708 for domestic callers
- 201-689-8259 for international
callers
Please dial-in approximately 10 minutes prior to the start of
the call.
Webcast
A live webcast of the conference call and presentation slides
will be accessible on our website under the “Investor Relations”
tab at www.cubic.com. Please visit the website at least 15 minutes
prior to the call to register, download and install any streaming
media software needed to listen to the webcast. A replay of the
broadcast will be available on the Investor Relations tab of
Cubic's website.
About Cubic Corporation
Cubic Corporation designs, integrates and operates systems,
products and services focused in the transportation, defense
training and secure communications markets. As the parent company
of two major business units, Cubic’s mission is to increase
situational awareness and understanding for customers worldwide.
Cubic Transportation Systems is a leading integrator of payment and
information technology and services to create intelligent travel
solutions for transportation authorities and operators. Cubic
Global Defense is a leading provider of realistic combat training
systems, secure communications and networking and highly
specialized support services for military and security forces of
the U.S. and allied nations. For more information about Cubic,
please visit the company's website at www.cubic.com or on Twitter
@CubicCorp.
Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that are subject to the safe harbor created by such Act.
Forward-looking statements include, among others, statements about
Cubic’s growth strategy, the anticipated costs of the acquisitions,
potential benefits to Cubic’s international presence, the timing of
the closing of the GATR acquisition and potential broader selection
for SATCOM applications and expansion of sales. These statements
are often, but not always, made through the use of words or phrases
such as “may,” “will,” “anticipate,” “estimate,” “plan,” “project,”
“continuing,” “ongoing,” “expect,” “believe,” “intend,” “predict,”
“potential,” “opportunity” and similar words or phrases or the
negatives of these words or phrases. These statements involve
risks, estimates, assumptions and uncertainties that could cause
actual results to differ materially from those expressed in these
statements, including, among others: Cubic’s ability to
successfully integrate new companies into its business and to
properly assess the effects of such integration on its financial
condition; competition and technology changes in the industries in
which Cubic does business; and Cubic’s ability to successfully
develop, introduce and sell new products, systems and services in
current and future markets. In addition, please refer to the risk
factors contained in Cubic’s SEC filings available at www.sec.gov,
including Cubic’s most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. Because the risks, estimates,
assumptions and uncertainties referred to above could cause actual
results or outcomes to differ materially from those expressed in
any forward-looking statements, you should not place undue reliance
on any forward- looking statements. Any forward-looking statement
speaks only as of the date hereof, and, except as required by law,
Cubic undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date
hereof.
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version on businesswire.com: http://www.businesswire.com/news/home/20151221005235/en/
Cubic CorporationMedia contact:Suzanne Hatcher,
858-505-2430Director, Corporate
Communicationssuzanne.hatcher@cubic.comorInvestor contact:Diane
Dyer, 858-505-2907Director, Investor
Relationsdiane.dyer@cubic.com
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