L-3 Acquires CTC Aviation Group
By Business Wire News
By Business Wire News
L-3 Communications (NYSE:LLL) announced today that on May 27, 2015 it acquired UK-headquartered CTC Aviation Group, now known as L-3 CTC Ltd. The purchase price is £143 million (approximately $220 million) and was funded with cash on hand. The acquisition is expected to be immediately accretive to L-3’s results of operations.
L-3 CTC is a high-quality, global airline pilot training and crew resourcing specialist that offers customized and innovative solutions to major airlines and retail customers globally. This acquisition expands L-3’s Commercial Aviation Training business, which also includes L-3 Link UK, a provider of world-class flight training simulation devices, aftermarket solutions and training, to encompass a growing portfolio of airline and third-party training company customers. L-3 CTC has approximately 265 employees. L-3 CTC forecasts sales for the years ending December 31, 2015 and 2016, of $86 million and $95 million, respectively, and is expected to add approximately $50 million to L-3’s sales for the year ending December 31, 2015. L-3 CTC is a high-margin business that is expected to generate operating margins that generally exceed those of the Electronic Systems segment as a whole.
“This acquisition is a very good fit with our strategy of expanding our international and commercial presence by focusing on higher-margin businesses with number one or two positions in the markets we serve,” said Michael T. Strianese, L-3’s chairman, president and chief executive officer. “L-3 CTC has a worldwide reputation for excellence and strengthens our Link Simulation & Training and Link UK businesses with value-added synergies for total training solutions across a wide range of military and commercial platforms. This addition will solidify L-3’s position as a global leader in commercial flight simulation and training, while delivering value to our customers and shareholders.”
L-3 CTC and L-3 Link UK will retain their individual brands and strengths as independent operational entities, while continuing to focus on and serve their existing customers and markets. The synergistic collaboration of these two businesses enables new and innovative approaches to vertically integrated training, resourcing and simulation solutions. The business portfolio will span the entire spectrum of customer needs, delivering unique and innovative capabilities, an unmatched value proposition, and a strong emphasis on customer service.
“Driven by a focus on the customer, quality, service and safety, this new partnership of world-class training devices and training delivery places L-3 Link UK and L-3 CTC in the unique position to provide customers with totally scalable training solutions whatever their requirements,” said Alan Crawford, managing director of L-3 Link UK. “This acquisition also enables L-3 to build on strategic partnerships with key growth airlines in an environment where a global shortage of pilot training resources and increased pilot demand are driving the growing need for tailored pilot training solutions. We look forward to working very closely with L-3 CTC to bring to our customers the unique propositions that can only be delivered by a customer-focused training and resourcing solutions company.”
L-3 CTC will be integrated into the Precision Engagement & Training sector, which is part of L-3’s Electronic Systems segment.
Headquartered in New York City, L-3 employs approximately 45,000 people worldwide and is a prime contractor in aerospace systems and national security solutions. L-3 is also a leading provider of a broad range of communication and electronic systems and products used on military and commercial platforms. The company reported 2014 sales of $12.1 billion.
To learn more about L-3, please visit the company’s website at www.L-3com.com. L-3 uses its website as a channel of distribution of material company information. Financial and other material information regarding L-3 is routinely posted on the company’s website and is readily accessible.
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