Industry Week in Review – June 24, 2011

On Wednesday, President Obama announced plans for the reduction of troops in Afghanistan, with 10,000 U.S. troops scheduled to return home by year-end, and a total of 33,000 troops by the end of next summer. Savings are expected to be significant as each soldier in Afghanistan costs the U.S. approximately $1.0 to $1.2 million dollars per year. Combined with planned spending cuts, the U.S. expects to spend $118 billion for overseas operations in FY12 compared to $158 billion in FY11, with even lower spending anticipated in FY13.

Notes on some big movers:

AeroVironment, Inc. (Up 27.2%): Shares rose as the company reported unaudited consolidated earnings for 4Q11 and FY11.  Q4 EPS was $0.79 versus $0.71 a year ago, beating analyst expectations of $0.69.   EPS for the year was $1.17 versus $0.94 in FY10.

Breeze-Eastern Corporation (Up 17.4%): Shares rose for the week following Tinicum Capital Partners’ $6.82M purchase of 791,706 shares ($8.62 a share), bringing its stake in the company to 34.8%.

Notes on some relevant transactions:

GMA Cover Corporation announced Wednesday that it has been acquired by Admiralty Partners Inc., a private investment firm that invests exclusively within the global A&D and federal IT industries, for an undisclosed amount. GMA Cover Corporation provides engineered systems including concealment, aerial delivery, flexible fuel and water storage, vehicle soft-top systems, and tactical soft shelters for the DoD.

CACI announced Monday that it will acquire Pangia Technologies LLC, a software engineering company that provides technical solutions in the areas of computer network operations, information assurance, and software and systems engineering for the IC, DHS, U.S. Air Force, and U.S. Navy.  The terms of the transaction, which is expected to close by July 1, 2011, were not disclosed. This acquisition expands CACI’s cybersecurity solutions and increases its already strong presence in the IC.

Citi Venture Capital International announced last Friday that it will acquire Ness Technologies Inc., an Israeli IT services company, for $7.75 per share, or $307 million in cash. The transaction is expected to be completed in the next three to six months subject to shareholder approval and other requirements.

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