KippsDeSanto & Co. Advises Arkansas Power Electronics International, Inc. on its Sale to Cree, Inc.

KippsDeSanto & Co. is pleased to announce the sale of our client, Arkansas Power Electronics International, Inc. (“APEI” or “the Company”), to Cree, Inc. (“Cree”).  APEI develops, designs, and manufactures high performance power electronics and wireless systems, including motor drives, inverters, power modules, and DC / DC converters.  APEI has been a recognized industry leader in power modules and power electronics applications.   Based in Fayetteville, AR, APEI sits at the center of the SiC power module market, with a focus on providing high performance modules and systems and driving a market shift from traditional silicon-based power electronics towards SiC components.

We believe this transaction demonstrates several key trends in the electronics M&A environment:

  • Attractiveness of proprietary, differentiated technologies
  • Strategic acquisition to enhance technology depth, gain customer reach, and vertically integrate manufacturing to quickly capitalize on a rapidly growing market
  • Growing demand for high performance, highly durable power electronics components for aerospace, defense, and commercial markets

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace / defense and technology companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

 

PRESS RELEASE

DURHAM, N.C., July 9, 2015 – Cree, Inc. (Nasdaq:  CREE), a market leader in silicon-carbide (SiC) power and RF products  today announced the acquisition of APEI, a global leader in power  modules and power electronics applications. Combining two highly complementary innovators, the acquisition enables Cree’s Power and RF  business to extend its leadership position and help to accelerate the  market for high-performance, best-in-class SiC power modules.

This acquisition strengthens Cree’s market-leading position for SiC power electronics, infusing the Power and RF business with additional  intellectual property and applications expertise at the systems level  from APEI. The companies’ shared mission to deliver the industry’s most  innovative SiC power products has already led to successful  collaboration on multiple government contracts. In 2014, the  co-development of a High-Performance Silicon Carbide-based Plug-In  Hybrid Electric Vehicle Battery Charger on an ARPA-E program resulted in  an R&D 100 award, recognizing the 100 most innovative technology  advancements of the year.

“Adding this expert team of innovators and portfolio of patents will enable us to further disrupt and expand the market,” said Frank Plastina, executive vice president, Cree Power and RF. “Extending our  research and development capabilities with APEI, a leader in wide bandgap power R&D, will help us accelerate delivery of a full spectrum of SiC power modules to meet customer requirements for performance and cost.”

“Joining forces with the market leader in silicon-carbide power gives  us an opportunity to commercialize our products faster,” said Dr.

Alex  Lostetter, president and CEO of APEI. “This ideal combination of chip  technology and packaging will give us first-mover advantage, helping us  to set the industry standard for power modules.”

The APEI team, now Cree Fayetteville, Inc., will continue to be based  in Fayetteville, AR., and will operate as part of Cree’s Power and RF  business. Under the terms of the agreement, Cree will acquire APEI in a  merger transaction. The transaction is not targeted to have a material  impact on Cree’s fiscal 2016 earnings.

About Cree, Inc.

Cree is leading the LED lighting revolution and making energy-wasting  traditional lighting technologies obsolete through the use of energy-efficient, mercury-free LED lighting. Cree is a market-leading  innovator of lighting-class LEDs, LED lighting and semiconductor products for power and radio-frequency (RF) applications.

Cree’s product families include LED fixtures and bulbs, blue and green LED chips, high-brightness LEDs, lighting-class power LEDs, power-switching devices and RF devices. Cree® products are driving improvements in applications such as general illumination, electronic  signs and signals, power supplies and solar inverters.

KippsDeSanto & Co. Advises Kutta Technologies, Inc. on its Sale to Sierra Nevada Corporation

KippsDesanto & Co. is pleased to announce the acquisition of our client, Kutta Technologies, Inc. (“Kutta” or the “Company”), by Sierra Nevada Corporation (“SNC”).   Kutta is a high-tech designer, developer, and manufacturer of C4ISR software and hardware applications supporting the Department of Defense (“DoD”), leading defense industry prime contractors, and commercial customers.  Kutta has created a leading suite of solutions that allow for advanced Unmanned Aerial Systems (“UAS”) command and control (“C2”) integration of UAS into the National Airspace System (“NAS”).  This acquisition provides a complementary platform of UAS solutions to SNC’s expanding multi-mission ISR products and services.

Based in Phoenix, AZ, Kutta is a leading developer of mission-critical C2 UAS solutions aimed at improving situational awareness, forward operator safety, the probability of mission success, and communication links.  Kutta’s UAS products and solutions solve UAS C2 problems with licensable software components and hardware products.  For example, Kutta has designed and fielded a proprietary solution that provides a field-operator with a system to safely and autonomously route multiple UAS and control on board sensors.  The Company’s products are designed to meet The North Atlantic Treaty Organization’s (“NATO”) Standardization Agreement 4586 standards and the Federal Aviation Administration (“FAA”) DO-178C guidelines.  Kutta has also developed proprietary solutions to address manned / unmanned teaming (UAS control from the cockpit of manned aircraft).  Additionally, Kutta is a leader in rugged and survivable communications systems crucial to first responders and the mining industry, holding a Part 23 Mine Safety and Health Administration (“MSHA”) certification for its Digital Radio for Underground Miners (“DRUM”) radio system. Through its partnership with SNC, Kutta expects to deliver even greater value to its customers, as well as pursue additional growth areas.

We believe this transaction demonstrates several key trends in the defense M&A environment:

  • Value continues to be placed on next-generation UAS and related C4ISR solutions in support of mission-critical programs
  • Growing demand for highly-specialized solutions addressing UAS NAS integration for both commercial and defense applications
  • Buyers looking to acquire proprietary technology and intellectual property to complement and expand upon existing solutions

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace / defense and government technology solutions companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

 

PRESS RELEASE

Sierra Nevada Corporation Acquires Kutta Technologies, Inc. to Expand its Unmanned Technologies

Sierra Nevada Corporation (SNC) is proud to announce the successful acquisition of its newest wholly-owned subsidiary, Kutta Technologies, Inc. (Kutta) located in Phoenix, Arizona.

SPARKS, Nev. (PRWEB) April 23, 2015 – Sierra Nevada Corporation (SNC) is proud to announce the successful acquisition of its newest wholly-owned subsidiary, Kutta Technologies, Inc. (Kutta) located in Phoenix, Arizona. Kutta is a leader in Unmanned Technologies with specialized capabilities in command/control (C2), manned-unmanned teaming, visualization and airspace management/deconfliction. The company will continue its operations in Phoenix, while supporting SNC’s Integrated Missions Systems (IMS) business area in both its Hagerstown, Maryland and Huntsville, Alabama locations.

“We’re excited to have Kutta, with its excellent management team join the SNC family,” said SNC President Eren Ozmen. “With 15 years of experience in unmanned systems, Kutta brings a wealth of exciting technologies and capabilities to greatly expand our technical offerings. The acquisition will also allow Kutta’s products to be exposed to a much larger audience through SNC.”

SNC’s IMS business area currently provides world-class aviation integration, intelligence, surveillance and reconnaissance, and unmanned integration. This acquisition builds upon a long-standing, successful working relationship between the two companies. It will expand SNC’s capabilities and products, providing customers with a comprehensive set of unmanned system control technology, magnetic wave radios, manned-unmanned teaming technologies and national air space deconfliction technology.

“Kutta possesses a robust intellectual property portfolio which positions it at the forefront of the Unmanned Aerial Systems (UAS) C2 communications and visualization technologies marketplace,” said Tim Owings, corporate vice president of SNC’s IMS business area. “SNC’s relationship with Kutta has proven to be very collaborative. We look forward to a prosperous future together.”

“We are very excited to be a part of the SNC IMS group,” said Doug Limbaugh, former CEO of Kutta Technologies. “Prior to this acquisition, we worked with SNC very successfully on multiple projects and found their leadership and engineering teams to be first class. Now as part of a wholly-owned subsidiary of SNC, we know that together we can grow our UAS and communications products to a whole new level.”

Kutta UAS products and solutions solve UAS C2 problems with licensable software components and hardware products. The company’s products are designed to meet The North Atlantic Treaty Organization’s (NATO) Standardization Agreement 4586 standards and the Federal Aviation Administration (FAA) DO-178C guidelines. Kutta is also a leader in rugged and survivable communications systems crucial to first responders and the mining industry, holding a Part 23 Mine Safety and Health Administration certification for its Digital Radio for Underground Miners (DRUM) radio system.

About Sierra Nevada Corporation
Sierra Nevada Corporation (SNC), headquartered in Sparks, Nevada, is among the “World’s Top 10 Most Innovative Companies in Space.” Over the last 30 years, under the leadership of President Eren Ozmen and CEO Fatih Ozmen, SNC has become one of America’s fastest-growing private companies and the Top Woman-Owned Federal Contractor in the United States. With a workforce of over 3,000 personnel, SNC now has 32 locations in 18 states and three locations in Europe. SNC has a reputation for rapid, innovative, and agile technology solutions in electronics, aerospace, avionics, space, propulsion, micro-satellite, aircraft, and communications systems.

SNC has six unique business areas that are dedicated to providing leading-edge solutions to its dynamic customer base. SNC has a proven track record of success spanning more than five decades. It is focused on providing its customers with the very best in diversified technologies and continues to focus its growth on the commercial sector through internal advancements in dual-use applications and outside acquisitions including the emerging markets of telemedicine, Cyber and net-centric operations.

For more information on SNC visit http://www.sncorp.com and follow us at Facebook/Sierra Nevada Corporation. Sierra Nevada Corporation and SNC are trademarks of Sierra Nevada Corporation.

About Kutta Technologies
Kutta Technologies (Kutta) is a high-tech research & development, manufacturer and supplier of command-control-communications software applications, interconnects, components and subsystems for Department of Defense, Department of Homeland Security and National Institute of Occupational Safety and Health programs. Kutta designs and develops innovative communication and visualization technologies that revolutionize industries. We employ highly-experienced mathematicians, physicists, and electrical and software engineers, and have created a culture and environment for delivering high-impact results. For more information on Kutta visit http://www.kuttatech.com.

KippsDeSanto & Co. Advises Digital Results Group on its Sale to Novetta Solutions

KippsDeSanto & Co. is pleased to announce the sale of our client, Digital Results Group, Inc. (“DRG”) to Novetta Solutions, LLC (“Novetta”), a portfolio company of Arlington Capital Partners.  DRG delivers next generation, multi-source intelligence collection, command, control, and exploitation (“C2 / PED”) solutions to customers across the defense and intelligence communities.  A critical differentiator of the Company’s technology is the ability to seamlessly process operations and intelligence data from a wide range of systems, platforms, and sensors, and then provide tools to visualize and exploit this information from anywhere across the network.  The transaction provides hardware and software solutions for multi-INT data collection, collaboration, and exploitation to Novetta’s growing suite of advanced analytics and mission-critical analysis solutions.

Based in Boston, MA, DRG is a leader in the development of innovative solutions that support critical defense, intelligence, and security missions.  By fusing real-time sensor, operations, and intelligence data into a common operating picture and exploitation tool set, DRG’s solutions deliver best-in-class capabilities to support operations and analysis from the tactical edge to the global enterprise.  DRG’s browser-based technology solutions significantly improve collaboration, understanding, mission execution, and outcome. DRG’s solutions are deployed to support a range of mission profiles to include ISR / persistent surveillance, force protection, precision fires, mission support / battle command, and intelligence collection, analysis, and reporting.  At the core of the platform is a widely-fielded, C2 / PED solution called Ageon ISR, which has been tailored to meet unique mission requirements and computing environments to provide unparalleled mission flexibility.

We believe this transaction demonstrates several key trends in the aerospace / defense and government technology solutions M&A environment:

  • Premium value placed on companies with evolutionary business models that deliver innovative solutions supporting critical C4ISR missions
  • Buyers are looking to acquire proprietary products, technology, and intellectual property to complement and expand upon existing solutions
  • Value of strong relationships with well-funded customers in priority budget areas

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace / defense and government technology solutions companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

KippsDeSanto & Co. Advises Ampex Data Systems on Its Sale to Delta Information Systems

KippsDeSanto & Co. is pleased to announce the sale of our client, Ampex Data Systems Corporation (“Ampex” or “the Company”), to Delta Information Systems, Inc. (“Delta”). Ampex delivers innovative aerospace electronic solutions to enable high performance ruggedized airborne data storage and recording for mission and flight test operations, in support of a diverse, global customer base that includes blue chip Original Equipment Manufacturers (“OEM”), Tier 1 suppliers, and military agencies. Ampex differentiates from its competitors through a suite of highly-proprietary designs and software, as well as a history of investment in intellectual property, to underpin a unique set of products for the collection of digital image, sensor, and complex avionics data across several aircraft and ground platforms. Through this acquisition, Delta is able to combine the Company’s technologies with its own line of video communications and aerospace telemetry products to capitalize on the growing addressable market for ruggedized data acquisition and airborne network file servers.

Based in Redwood City, CA, Ampex is an aerospace electronics company focused on designing and producing high capacity, high performance ruggedized data recorders and network file servers used in flight testing programs and intelligence, surveillance, and reconnaissance (“ISR”) missions, with a focus on functionality and compatibility with cutting-edge sources. The Company’s extensive engineering capabilities, industry certifications, and specialized product approaches have established it as a pioneer in the airborne data acquisition field; Ampex is one of a few suppliers in the world with the Chapter 10 recording certification, enabling it to meet the range of highly-stringent mil-spec recording standards and construction specifications. Ampex also boasts an experienced team of subject matter experts and thought leaders in the fields of airborne communications technology, ruggedization, and sensor electronics. Given recent investments in technology upgrades and new product releases, as well as the increasing role of ISR and data acquisition in global aircraft operations, the Company is well-positioned for growth in the aerospace electronics / sensors market.

We believe this transaction demonstrates several key trends in the aerospace / defense and government technology solutions M&A environment:

  • Continued M&A activity within lucrative aerospace electronics market
  • Strategic acquisitions by mid-sized aerospace / defense companies to enhance technology depth and customer reach in order to catalyze growth
  • Attractiveness of sellers with thought leadership and extensive intellectual property, creating barriers to entry in high growth, emerging technology areas

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace / defense and government technology solutions companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

 

PRESS RELEASE

Delta Information Systems, Inc. Completes Acquisition of Ampex Data Systems Corporation

Horsham, PA, October 28, 2014 – We are very pleased to announce that Delta Information Systems, Inc. has completed the acquisition of Ampex Data Systems Corporation (ADSC) of Redwood City, CA. ADSC is a leading supplier of high-capacity, high-performance digital storage systems capable of functioning in demanding environments on land, at sea or in the air.Delta Information Systems, Inc. Completes Acquisition of Ampex Data Systems Corporation

“We are very excited about our new relationship with ADSC. For nearly 70 years, Ampex Corporation has been the acknowledged leader in recording and storage technology and Ampex Data Systems Corporation represents the future of this storied legacy making world class products available to aviation and defense markets. The ADSC product lines provide a strategic complement to the product lines of our Delta Digital Video, GDP Space Systems and Acroamatics business areas” said Gary Thom, President of Delta Information Systems, Inc. “We expect this acquisition to help position us to provide Best-of-Breed solutions for Intelligence, Surveillance and Reconnaissance (ISR) mission recording and transmission as well as complementing our flight test telemetry product offerings.”

“We are very pleased that this acquisition will provide our customers with continuing service and support by a company whose culture and values very closely match our own” said Larry Chiarella, President of Ampex Data Systems Corp. Ampex Data Systems Corp. will continue to operate under its own name as a wholly owned subsidiary of Delta Information Systems located in Redwood City, CA, and will continue to provide outstanding products and services to new and existing customers.

About Delta Information Systems, Inc.: Delta Information Systems, Inc., located in Horsham, PA, is a developer and manufacturer of electronic equipment in two high technology business areas. Delta Digital Video (DDV) produces video compression and video scan conversion products for military, law enforcement and remote monitoring applications. A key product area is rugged airborne video compression units used in Unmanned Aerial Vehicles. GDP Space Systems and our newly acquired Acroamatics, Inc. are recognized industry leaders supplying high quality state-of-the-art aerospace telemetry products for flight test and satellite command and control applications. GDP’s Next Generation Diversity Combining Best Source Selector product was key in the qualification of the Joint Strike Fighter as well as a variety of other flight test and launch programs. Acroamatics’ Telemetry Data Processor product line provides critical support for flight test and range safety processing and display requirements. Delta is committed to producing high quality, defect free products and has a Quality Management System that is certified to ISO9000:2008/AS9100C.

About Ampex Data Systems Corp.: Ampex Data Systems Corporation (“ADSC”) is headquartered in Redwood City, California with a service center in Colorado Springs, Colorado. ADSC has wholly owned subsidiaries in Great Britain, Ampex Great Britain, Ltd., and Japan, Ampex Japan, Ltd. Its products are also offered in other major overseas markets through distributors. The principal products produced by the company are high-capacity, high-performance digital storage systems capable of functioning in demanding environments on land, at sea or in the air. ADSC products are essential for defense applications which need to record video, telemetry or other mission critical data from aircraft, satellites and submarines. These products are also used in flight and sensor test applications.

KippsDeSanto & Co. Advises General Dynamics Advanced Information Systems, Inc. on the Sale of Its Advanced Systems Line of Business to MacDonald, Dettwiler and Associates Ltd.

KippsDeSanto & Co. is pleased to announce the sale of the Advanced Systems line of business (the “Company”) of General Dynamics Advanced Information Systems, Inc. (“GDAIS”) to MacDonald, Dettwiler and Associates Ltd. (“MDA”) (TSX:MDA).  The transaction affords new opportunities for MDA, a Canadian based publicly traded company, to support additional surveillance and intelligence programs in the United States.

Based in Ypsilanti, Michigan, the Advanced Systems line of business is a leader in the design, development, and production of radar and other information sensors for the U.S. government.  The Advanced Systems line of business is strategically positioned given shifting focus towards strategic national security areas of interest that require advanced Intelligence, Surveillance, and Reconnaissance (“ISR”) capabilities.

We believe this transaction demonstrates several key trends in the aerospace / defense and government technology solutions M&A environment:

  • Continued trend of corporate divestitures as businesses of all sizes shape their portfolio to focus on the core
  • Attractiveness of differentiated technology solutions in mission-critical markets (e.g., intelligence, C4ISR)
  • Emphasis on entrenched and long-standing relationships with coveted IC customers

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading aerospace / defense and government technology solutions companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

 

PRESS RELEASE

MDA Completes Strategic Capability Acquisition in the United States

VANCOUVER, Oct. 3, 2014 /CNW/ – MacDonald, Dettwiler and Associates Ltd. (“MDA” or the “Company”) (TSX:MDA), a global communications and information company, today announced that it has closed the acquisition of Advanced Systems, a line of business from General Dynamics Advanced Information Systems, Inc., announced in July 2014.? This business will become part of MDA Information Systems LLC.

Located near Detroit, Michigan, the Advanced Systems business has approximately 170 employees and generates annual revenues of approximately US$40 million. The business has over 50 years of in-depth experience in development and application of radar and other information sensors for the U.S. Government.  This unique capability is expected to strengthen the Company’s ability to pursue future opportunities in the U.S. market.

About MDA

MDA is a global communications and information company providing operational solutions to commercial and government organizations worldwide.

MDA’s business is focused on markets and customers with strong repeat business potential, primarily in the Communications sector and the Surveillance and Intelligence sector. In addition, the Company conducts a significant amount of advanced technology development.

MDA’s established global customer base is served by more than 4,800 employees operating from 11 locations in the United States, Canada, and internationally.

The Company’s common shares trade on the Toronto Stock Exchange under the symbol “MDA.”

KippsDeSanto & Co. Advises UEC Electronics, LLC on its Sale to Arotech Corporation

KippsDeSanto & Co. is pleased to announce the acquisition of our client, UEC Electronics, LLC (“UEC” or “the Company”), by Arotech Corporation (“Arotech”).  The acquisition provides differentiated electronics manufacturing and engineering capabilities to Arotech and strengthens the acquirer’s footprint within the U.S. defense and aerospace market.

Headquartered in Hanahan, SC, UEC is a leading provider of high-end electronics engineering and design, rapid prototyping, and vertically-integrated production services for military, aerospace, and industrial customers.  Since inception, the Company has fostered its reputation as an expert product designer and developer of critical electronics, spanning components and subassemblies through end-use systems.  UEC’s unique suite of production capabilities, proven performance, proprietary solutions, and wealth of experience makes the Company a trusted supplier to a full array of military customers and original equipment manufacturers (“OEM”), including Marine Corps Systems Command, Space and Naval Warfare Systems Command, Raytheon, Boeing, Lockheed Martin and BAE Systems.

We believe this transaction demonstrates several key trends in the defense and aerospace technology M&A sector:

  • Attractiveness of proprietary, differentiated technologies, with an emphasis on power distribution and management solutions
  • Prime positions on large, long-term, and well-funded programs that provide critical support to future military and industrial initiatives
  • Heralded reputation as a trusted supplier to OEMs and government agencies, creating significant competitive advantages and barriers to entry
  • Importance of expert employee base and process-oriented infrastructure, underpinning institutionalized expertise around electronic design and production

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading technology and defense companies.  For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

 

PRESS RELEASE

AROTECH ACQUIRES UEC ELECTRONICS 

UEC provides engineering design, product development, rapid prototyping and innovative manufacturing services for military, aerospace and industrial customers

Purchase price of $31.1 million represents a multiple of
6.9 times UEC’s 2013 EBITDA
 

Ann Arbor, Michigan, April 1, 2014 – Arotech Corporation (NasdaqGM: ARTX), a provider of quality defense and security products for the military, law enforcement and homeland security markets, announced today that it has acquired UEC Electronics LLC, a company based in Hanahan, South Carolina. UEC will be integrated into Arotech’s Battery and Power Systems Division.

UEC develops and manufactures electronic components and subsystems primarily for military, aerospace and industrial customers. UEC specializes in core, proprietary engineering capabilities in highly-demanded solution areas, including: (i) hybrid power generation systems, (ii) smart power subsystems for military vehicles and dismounted applications, and (iii) aircraft and missile systems support for cutting-edge weapons and communications technologies.

UEC’s unique brand of comprehensive service is highly sought-after by customer agencies such as the Marine Corps Systems Command, Space and Naval Warfare Systems Command (SPAWAR), and Tank Automotive Command (TACOM), as well as large prime contractors such as Raytheon, Boeing, Lockheed Martin and BAE Systems.

UEC’s key program areas include the following:

  • UEC supplies the United States Marine Corps (USMC) with its proprietary Ground Renewable Expeditionary Energy Network Systems (GREENS), a renewable power generation, storage and distribution system for troops serving in austere environments;
  • UEC has developed a proprietary Distributed Power Control and Management System (DPCMS) for TACOM and the USMC, to provide electrical system upgrades for military armored vehicle modernization;
  • UEC has developed significant expertise and past performance qualifications in the area of solutions for Command, Control, Communications, Computers Intelligence, Surveillance and Reconnaissance (C4ISR), providing these solutions to, among others, SPAWAR and Raytheon.

The initial acquisition price of UEC was approximately $31.1 million plus a potential earn-out of $5.5 million over the next two calendar years.  The initial payment consisted of $28.0 million in cash and 775,000 shares of our common stock, with a value of approximately $3.1 million (based on the volume-weighted average price (VWAP) of our common stock over the previous 45 days). Arotech’s primary bank has funded $22.5 million of the cash requirement ($18.0 million at a 2014 rate of LIBOR plus 3.75% and $4.5 million at a 2014 rate of LIBOR plus 5.5%), which Arotech expects to pay back over the next five years out of its operating cash flow.

Robert S. Ehrlich, Arotech’s Chairman and Chief Executive Officer commented, “UEC is a highly complementary business to our Battery and Power Systems Division. The combination opens up many new market opportunities for us as a combined entity. UEC brings us significant electronic engineering and manufacturing skills which combines very well with our expertise in military and commercial grade battery technology and management systems. In addition, we see very strong sales and marketing synergies as well as the potential to make efficient use of shared resources.”

Continued Mr. Ehrlich, “I expect the combination of Arotech and UEC to be very much greater than the sum of its parts and I believe this acquisition should lead to significant growth for Arotech over the coming years.”

Rebecca Ufkes, UEC’s President, stated, “This combination is a logical progression to support UEC’s strong organic growth. This strategic alignment will provide UEC with access to capital required to scale our existing infrastructure for larger programs and requirements, as well as to increase distribution channels for UEC OEM products. Arotech is an innovative and agile corporation with a strong technical team and an unwavering commitment to engineering development and manufacturing excellence. Our company visions and cultures are very much aligned and create a model for collaboration and success.”

Guidance for 2014

For the full year 2014, including UEC’s results for the last nine months of 2014, Arotech expects revenues to be between $117 million and $123 million, and EBITDA to be in the range of between $8.0 million and $8.5 million.

The financial guidance provided is as of today and Arotech undertakes no obligation to update its estimates in the future.

Conference Call

The Company will be hosting a conference call later today, Tuesday, April 1, 2014 at 11:00 a.m. ET to discuss the UEC acquisition as well as its full year 2013 financial results and 2014 guidance. Those wishing to access the conference call should dial:

1-888-668-9141 (U.S.) or +1- 347-293-1926 (international).

For those unable to participate, the teleconference will be available for replay on Arotech’s website at http://www.arotech.com/ beginning 24 hours after the call.

About Arotech Corporation

Arotech Corporation is a leading provider of quality defense and security products for the military, law enforcement and homeland security markets, including multimedia interactive simulators/trainers and advanced zinc-air and lithium batteries and chargers. Arotech operates two major business divisions: Training and Simulation and Battery and Power Systems.

Arotech is incorporated in Delaware, with corporate offices in Ann Arbor, Michigan, and research, development and production subsidiaries in Alabama, Michigan, South Carolina and Israel. For more information on Arotech, please visit Arotech’s website at www.arotech.com.

Investor Relations Contacts:
Ehud Helft & Kenny Green
GK Investor Relations
Tel: 1 646 201 9246
arotech@gkir.com


Except for the historical information herein, the matters discussed in this news release include forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management’s current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, readers are cautioned not to place undue reliance on these forward-looking statements, as they are subject to various risks and uncertainties that may cause actual results to vary materially. These risks and uncertainties include, but are not limited to, risks relating to: product and technology development; the uncertainty of the market for Arotech’s products; changing economic conditions; delay, cancellation or non-renewal, in whole or in part, of contracts or of purchase orders (including as a result of budgetary cuts resulting from automatic sequestration under the Budget Control Act of 2011); and other risk factors detailed in Arotech’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and other filings with the Securities and Exchange Commission. Arotech assumes no obligation to update the information in this release. Reference to the Company’s website above does not constitute incorporation of any of the information thereon into this press release.

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KippsDeSanto & Co. Advises Chemring Group PLC on the Sale of the Clear Lake Operations of Chemring Energetic Devices to AMTEC Corporation

KippsDeSanto & Co. is pleased to announce the sale of the Clear Lake, South Dakota operations of Chemring Energetic Devices, Inc. to AMTEC Corporation, a subsidiary of National Presto Industries (NYSE:NPK). The transaction expands AMTEC’s portfolio of energetic and pyrotechnic devices and grows its footprint among key defense industry customers, while helping our client, Chemring Group PLC (LSE:CHG), to pursue its strategic initiatives of reshaping its defense and security portfolio.

The Clear Lake, South Dakota manufacturing facility is a leading provider of fuzes, fuze subcomponents, ammunition pellets, release cartridges, pyrotechnic devices, and military-grade energetic materials. Its products are used on a wide range of munitions, including artillery rounds, mortar rounds, missiles, bombs, and aircraft countermeasures. The facility serves the U.S. Department of Defense, foreign military agencies, and leading defense industry prime contractors, supporting numerous combat platforms such as attack helicopters, combat vehicles, aerial gunships, and advanced weapons platforms.

We believe this transaction demonstrates several key trends in the aerospace and defense M&A environment:

  • Continued use of divestitures for portfolio shaping in line with shifting strategic plans
  • Intrinsic value of entrenched customer relationships throughout the defense industrial base
  • Attractiveness of flexible manufacturing and high-rate production capabilities
  • Driving value through the ability to realize operational and production synergies

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading technology and defense companies. For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein

KippsDeSanto & Co. Advises Tactical Micro, Inc. on its Sale to Secure Communication Systems

KippsDeSanto & Co. is pleased to send you the attached press release announcing the acquisition of our client, Tactical Micro, Inc. (“Tactical Micro” or the “Company”), a portfolio company of Relativity Capital LLC (“Relativity”) by Secure Communication Systems, Inc. (“Secure”), a portfolio company of Vance Street Capital LLC (“Vance Street”).  Secure designs and manufactures ruggedized electronics for military, homeland security, and transportation markets, and its acquisition of Tactical Micro will enable it to expand its customer base into key military training and metropolitan transit markets, while broadening its product offerings.

Headquartered in Fredericksburg, VA, Tactical Micro is an industry-leading provider of high-end audio / video instrumentation and surveillance technology solutions for live fire military training and civilian customers.  Historically, the Company’s primary customer has been the U.S. Army, including a notable presence within the Program Executive Office of Simulation, Training, & Instrumentation (“PEO STRI”).  Tactical Micro has successfully transitioned into commercial markets as well, and is currently supporting a complex surveillance effort for the Washington Metropolitan Area Transit Authority (“WMATA”).  Through its partnership with Secure, Tactical Micro expects to deliver even greater value to its customers, as well as identify additional avenues for growth.

We believe this transaction demonstrates several key trends in the defense M&A environment:

  • Highly specialized solutions providers in mission-critical areas remain in demand despite overall budget and funding environment concerns
  • Importance of being deeply entrenched on large programs with significant backlog, providing strong revenue visibility and organic growth potential in the near-term
  • Strategic buyers continue to see M&A as a primary avenue to grow their organizations
  • Buyers continue to seek targets with strong growth potential evidenced by a robust, actionable pipeline

KippsDeSanto & Co. is an investment bank focused on delivering exceptional M&A and financing transaction results for leading technology and defense companies.  For more information on KippsDeSanto & Co., please visit www.kippsdesanto.com.

We welcome the opportunity to discuss how KippsDeSanto & Co. can help you achieve your strategic objectives. For more information on this particular transaction, please contact Karl Schmidt at 703.442.1413 or kschmidt@kippsdesanto.com.

KippsDeSanto & Co., member FINRA/SIPC, is not affiliated with other companies mentioned herein.

PRESS RELEASE

SECURE COMMUNICATION SYSTEMS, A PORTFOLIO COMPANY OF VANCE STREET CAPITAL, COMPLETES ACQUISITION OF TACTICAL MICRO

Acquisition Will Provide Secure Communication Systems with Greater Diversification of Offerings to Commercial Customers

 

LOS ANGELES – January 2, 2014 – Vance Street Capital LLC, a Los Angeles-based private equity firm, announced today that it has acquired Tactical Micro from Relativity Capital, an Arlington, Virginia-based private equity firm. Terms of the transaction were not disclosed. Tactical Micro is the third add-on acquisition for Secure Communication Systems, a designer and manufacturer of rugged computer and information assurance systems.

Based in Fredericksburg, Virginia, Tactical Micro is a premiere provider of high-end training, instrumentation and surveillance solutions for military and commercial customers. The company’s products are used in support of military training, metropolitan security systems and other complex surveillance solutions.

“Tactical Micro has an impressive track record of consistent revenue growth,” said Allen Ronk, CEO of Secure Communication Systems. “The success of the company is a testament to its talented management team, its dedicated employees and innovative technology. We believe that Tactical Micro complements our current product offerings and we look forward to working together to further grow our businesses. ”

“This acquisition is a strong strategic fit for Secure and we expect Tactical Micro’s transition to be seamless,” said Brian Martin, principal at Vance Street Capital. “Having Tactical Micro on board will help Secure further diversify its end markets.”

Tactical Micro’s founder and president, John Moulton will retain an ownership stake in the company and will continue to serve as president.

“We are excited to partner with Secure and Vance Street Capital,” Moulton said. “Secure and Tactical Micro share strong engineering backgrounds and a commitment to excellence. As a division of Secure Communication Systems, we will be well positioned for the next phase of our company’s evolution.

Fifth Third Bank provided senior debt financing for the transaction and Babson Capital provided Mezzanine debt financing for the transaction. O’Melveny & Myers LLP acted as legal advisor to Vance Street Capital and Secure Communications. Relativity Capital and Tactical Micro retained KippsDeSanto & Co. as investment banker and Hogan Lovells as legal advisor.

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About Tactical Micro

Tactical Micro is an engineering systems integration company specializing in range instrumentation and audio/video broadcasting and recording systems for use in military training and commercial applications. Tactical Micro engineers have over 50 years of combined experience in developing military range training products and supporting military range instrumentation projects. The company is headquartered in Fredericksburg, Virginia and also has an office in Orlando, Florida.

About Secure Communication Systems

Secure Communication Systems designs and manufactures high reliability tactical mission computing systems, encryption equipment, communications products and related equipment for defense and commercial applications. The company offers handhelds, rugged tablet PCs, workstations and servers, routers, accessories, translators, tactical displays, and ultra-mobile PCs for various branches of the military as well as for commercial applications. The company was founded in 1986 and is based in Santa Ana, CA. For more information please visit: http://www.securecomm.com.

About Vance Street Capital

Vance Street Capital is a Los Angeles-based private equity firm that makes control investments in companies with enterprise values up to $200 million. Preferred industries include precision industrial manufacturing, aerospace & defense and medical components and devices. For over two decades, Vance Street’s partners have worked with management, family owners and other co-investors to accelerate revenue growth, improve operations and acquire strategic assets for the companies in their investment portfolio. For more information please visit: www.vancestreetcapital.com

 

FOR MORE INFORMATION CONTACT

Mickey Mandelbaum
Maya Pogoda
Muirfield Partners
(310) 785-0810
mickey@muirfieldpartners.com
maya@muirfieldpartners.com

CornerStone Capital Holdings