Over the past week, members of the Senate Armed Services Committee (“SASC”) put increased pressure on Defense Secretary Chuck Hagel to provide the DoD’s 2013 sequestration plan for the first portion of planned military cuts. The Presidential, House, and Senate budgets did not factor in the first year of sequestration cuts, about $40 billion that must be eliminated from the military’s 2013 budget.
Given the delay in providing cuts for 2013, SASC Committee Chairman Senator Carl Levin and Ranking Member Senator James Inhofe further requested that the Defense Secretary provide a package of reductions to the 2014 defense budget by no later than July 1, 2013 in order to meet the $52 billion savings requirement as established by the Budget Control Act. In their note to Defense Secretary Hagel, the bipartisan Senators wrote “We believe that the identification of these specific reductions will serve both to help Congress and the Department prepare for the possibility that we will be unable to avoid another round of sequestration and to show Congress and the public how unpalatable that outcome would be.”
Ducommun Inc. (Down 24.5%) – Shares were down this week after the company announced first quarter earnings of $0.35 per share, well below analyst expectations of $0.47 per share. The company reported first quarter revenue of $175.9, roughly $10 million below analyst expectations for the quarter.
HEICO Corp. to acquire Reinhold Industries, Inc., a provider of advanced custom composite components and complex composite assemblies for commercial aviation, defense, and space applications. Reinhold has been a portfolio company of The Jordan Company since being acquired in late 2006. Terms of the deal were not disclosed.
Haystax Technology, Inc. acquired FlexPoint Technology, LLC, a provider of cloud computing and enterprise content management services to government customers. The acquisition complements Haystax’s existing capabilities in big data analytics and mobile solutions after its acquisition of Digital Sandbox in mid-April. Terms of the deal were not disclosed.
Greenbriar Equity Group completed the acquisition of EDAC Technologies Corporation following its tender offer of $17.75 per share dated March 17, 2013. Since the initial offer by Greenbriar, EDAC had also received a tender offer from MidOcean Partners worth $18.25 per share, however this offer was subsequently withdrawn.