Defense electronics company Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT), which owns about 19% of GPS company Azimuth Technologies Ltd. (TASE:AZTC), has signed a deal to buy the remaining stake in the company.
Azimuth's shares soared 35% in morning trading, reaching NIS 2.18.
Elbit bought the 19% stake in November of 2008. Elbit Systems unit Elbit Security Systems Ltd. will purchase the balance of Azimuth's shares from Azimuth's shareholders for approximately $46.5 million (NIS 173 million). In the event that prior to the merger Azimuth distributes a dividend in the amount of approximately $5.4 million (NIS 20 million), the consideration paid by Elbit will be reduced by about $4.3 million (NIS 16 million).
The closing of the transaction is subject to approval by a general meeting of Azimuth's shareholders as well as approval by the Israeli Antitrust Authority.
Azimuth is an Israeli company engaged mainly in the areas of satellite navigation systems (GPS), electro-optics and data communications, for defense, para-government and civil applications. The company's systems are designed for target acquisition, fire coordination, navigation and orientation solutions, command and control as well as optical measurement systems for high accuracy. Azimuth has a subsidiary in the U.K. engaged in similar activities.
Elbit Systems CEO Joseph Ackerman said tht Azimuth's technology will complement that of another subsidiary, Elbit Systems Electro-Optics Elop. Ackerman added, "The acquisition of the balance of Azimuth's shares underscores our long-term strategy of growth through mergers and acquisitions of complementary companies with high synergistic value."
Published by Globes [online], Israel business news - www.globes-online.com - on January 25, 2010
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