Industry Week in Review – June 10, 2011
Defense Secretary nominee Leon Panetta testified before the Senate Armed Services Committee Thursday, stating that “the government does not need to choose between fiscal discipline and a strong national defense” in light of President Obama’s planned $400 billion in cuts to the security budget. In order to manage costs, Panetta intends to accelerate the Pentagon’s full financial audit and place “everything on the table” for review, from weapons programs to military health care and other entitlement programs. While legislators hope that Panetta’s OMB experience will empower him to make responsible budget cuts and reign in soaring weapons costs, worries remain that Panetta could put the nation’s security at risk by focusing solely on budgetary issues rather than defending the Pentagon’s interests.
Notes on some big movers:
Saab AB (Down 9.4%): Shares fell for the week as BAE Systems announced that it agreed to sell its remaining stake in the Company for $253 million, ending a 13-year investment in the Swedish weapons maker
Comtech Telecommunications Corp. (Down 12.2%): Shares fell for the week as the Company announced that it projects FY2011 revenue and EPS to be in the range of $620-$630 million and $1.90-$2.00, respectively, while analysts were expecting the Company to report revenues of $725.7 million and EPS of $2.02
CIBER, Inc. (Up 11.8%): Shares rose for the week as Company received the Values Award for Service Partners from Lawson Software; the Company reported 1Q11 revenue of $282.5 million, an 8% increase and the largest year-over-year increase in 10 quarters
Notes on some relevant transactions:
3M announced Thursday that it is acquiring Advanced Chemistry & Technology, a manufacturer of quick cure, light-weight polysulfide sealants for aerospace applications serving both commercial and military clients. The terms of the deal, which is expected to close in 3Q11, were undisclosed. The transaction expands 3M’s presence in the aerospace market, where the company anticipates demand for sealant to expand with the launch of new aircraft platforms.
PRV Aerospace announced Thursday that it has acquired the outstanding equity of Quality Forming, LLC, a manufacturer of large and complex, high-value precision sheet metal components and assemblies for the aerospace industry for an undisclosed amount. The transaction expands PRV Aerospace’s product and service offerings, bolstering its strategic importance to its customer base.
MCR announced Monday that it has acquired JB&A, Inc., a company that provides strategic planning, programming and budgeting, manpower analytical support and other professional services to U.S. government agencies. The terms of the deal, which closed on May 31, were not disclosed. The acquisition provides new opportunities for MCR to serve the Intelligence and Defense communities, where JB&A has a broad range of expertise.