MELBOURNE, Fla. and
HOUSTON, May 21 /PRNewswire-FirstCall/ -- Harris
Corporation (NYSE: HRS), an international communications and
information technology company, has entered into a definitive
agreement to acquire CapRock Communications, a global provider of
mission-critical managed satellite communications solutions for the
energy, government and maritime industries.
Established in 1981, CapRock
provides its customers with secure, highly-reliable managed
communication services including broadband Internet access, voice
over IP, networking and real-time video delivered to harsh and
remote locations around the world. CapRock managed network
solutions include multiband, portable and fixed satellite
communications services supported by its teleports and network
operations centers around the globe. CapRock designs,
implements and operates these sophisticated, end-to-end managed
network solutions under long-term contracts.
Under the terms of the agreement, Harris will purchase privately held
CapRock for $525 million in cash, subject to post-closing
adjustments. CapRock's audited financial statements for
calendar year 2009 included revenue of $359
million; earnings before interest, taxes, depreciation and
amortization (EBITDA) of $54 million;
and operating income of $28 million.
The acquisition is expected to be slightly accretive to
Harris earnings in fiscal year
2011, excluding acquisition-related charges, and a more significant
contributor to earnings in fiscal year 2012. The transaction
is subject to customary regulatory reviews, FCC license approvals,
and closing conditions, and it is expected to close during the
first quarter of fiscal 2011. Harris will finance the
acquisition using a combination of cash on hand, commercial paper,
and borrowings under its committed credit facilities.
"Acquiring CapRock expands our international presence and
customer base, while increasing the breadth of our assured
communications® offerings. We see increasing demand for
outsourced managed communications services that include secure
high-availability networks, creating growth opportunities across a
variety of markets," said Howard L.
Lance, chairman, president and CEO of Harris. "The acquisition provides an
entry into the energy market, while expanding our present offering
for the government and maritime markets to include managed
satellite communications solutions. CapRock is a
facilities-based global service provider that has made significant
strategic investments in a self-owned and operated infrastructure
to support demanding customer requirements. CapRock is a very
successful company that shares our passion and commitment to
mission-critical communications. It has an experienced
management team with a track record of double-digit growth and
profitability."
CapRock supports a wide range
of customers in the energy, maritime and government industries,
including Chevron, Diamond Offshore, ExxonMobil, Halliburton,
MODEC, Shell, Transocean, KBR, Green Reefers, Gulf Offshore,
Seatrans, Oceaneering, Subsea 7, the U.S. Department of Defense,
Department of Homeland Security and other federal civilian agencies
.
Headquartered in Houston,
Texas, CapRock has over 700
employees located primarily in Houston, Washington,
D.C., the U.K., Brazil, and
Indonesia. CapRock's strong
U.S. and international presence includes four international
teleports, four 24x7 network operations centers, eleven field
dispatch and customer service centers, and service on more than 50
satellites. The company supports over 2,000 customer sites in
over 120 countries around the world.
Peter Shaper, CapRock CEO, said,
"The combination of CapRock and
Harris will provide both
commercial and government customers with a new, stronger offering
to address their needs for mission-critical communications
services. Bringing these two companies together will give our
customers access to a combined breadth of services, depth of
expertise, and unparalleled customer commitment. We are
excited about this opportunity for our customers and our
employees."
Harris will host a live audio
webcast and conference call on Monday, May
24, at 6:30 p.m., ET in
conjunction with its annual Analyst Meeting being held in
Rochester, New York. The
webcast and conference call will include a discussion of the above
acquisition as part of presentations on the company's business
strategy and financial performance by Howard L. Lance, chairman, president and CEO,
and Gary L. McArthur, senior vice
president and chief financial officer. Interested individuals
are invited to listen to the call by using a dial-in number: (866)
730-5766, access code: 43143804. The conference call also will be
broadcast live via the Internet at http://www.harris.com. A
replay of the teleconference will be available beginning at
9:30 p.m., Eastern Time, and will run
until midnight, Eastern Time, on Monday, May
31. To access the replay, please call (888) 286-8010, access
code: 80727059. A recording of the call will also be available on
the Harris website beginning at
8:30 p.m., Eastern Time, on
May 24.
About Harris Corporation
Harris is an international
communications and information technology company serving
government and commercial markets in more than 150 countries.
Headquartered in Melbourne,
Florida, the company has approximately $5 billion of annual revenue and more than 15,000
employees — including nearly 7,000 engineers and scientists.
Harris is dedicated to developing best-in-class assured
communications® products, systems, and services.
Additional information about Harris Corporation is available
at www.harris.com.
About CapRock Communications
With nearly three decades of experience, CapRock Communications
is a premier global satellite communications provider for the
energy, maritime, government, engineering and construction and
mining industries as well as for disaster recovery services.
The company uses the latest field-proven satellite
technologies to deliver highly-reliable managed communications
services, including broadband Internet, voice over IP, secure
networking and real-time video, to the world's harshest and most
remote locations. CapRock delivers on its promise to be the
market's reliability leader by leveraging best-of-breed
partnerships, technical expertise and a robust global
infrastructure that includes four self-owned and operated teleports
and eleven regional support centers across North America, Central and South America, Europe, West
Africa and Asia Pacific.
CapRock is a portfolio company of ABRY Partners and its
affiliates, a Boston-based media,
communications, business and information services focused private
equity investment firm. More information about CapRock is available at www.CapRock.com.
Forward-Looking Statements
Statements in this press release that are not historical facts
are forward-looking statements that reflect management's current
expectations, assumptions, and estimates of future performance and
economic conditions. Such statements are made in reliance
upon the safe harbor provisions of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements in this release include but are not
limited to: anticipated timing of the closing of the acquisition of
CapRock and satisfaction of the
conditions to closing, the impact of the acquisition on
Harris earnings, and statements
regarding outlook, including revenue and growth opportunities.
The company cautions investors that any forward-looking
statements are subject to risks and uncertainties that may cause
actual results and future trends to differ materially from those
matters expressed in or implied by such forward-looking statements.
The company's consolidated results and the forward-looking
statements could be affected by many factors, including but not
limited to: the loss of our relationship with the U.S. government
or a shift in U.S. government funding; potential changes in U.S.
government or customer priorities; risks inherent with large
long-term fixed-price contracts, particularly the ability to
contain cost overruns; financial and government and regulatory
risks relating to international sales and operations; our ability
to continue to develop new products that achieve market acceptance;
the consequences of future geo-political events; strategic
acquisitions and the risks and uncertainties related thereto,
including our ability to manage and integrate acquired businesses;
performance of our subcontractors and suppliers; potential claims
that we are infringing the intellectual property rights of third
parties; the successful resolution of patent infringement claims
and the ultimate outcome of other contingencies, litigation and
legal matters; customer credit risk; risks inherent in developing
new technologies; changes in our effective tax rate; the potential
impact of natural disasters or other disruptions on our operations;
changes in future business conditions that could cause business
investments and/or recorded goodwill to become impaired; and the
recession in the United States and
general downturn in the global economy. Further information
relating to factors that may impact the company's results and
forward-looking statements are disclosed in the company's filings
with the SEC. The forward-looking statements contained in this
release are made as of the date of this release, and the company
disclaims any intention or obligation, other than imposed by law,
to update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise.
For additional information, contact Harris Corporation at
webmaster@harris.com.
Editors Note: A high-resolution photo of Howard Lance is available at
http://www.harris.com/harris/whats_new/Lance.jpg. A
high-resolution photo of Peter
Shaper is available at
http://www.harris.com/harris/whats_new/Peter.JPG. A
high-resolution photo of Harris Corporation's headquarters campus
is available at
http://www.harris.com/harris/whats_new/Teleport_P9180579.JPG.
A high-resolution photo of CapRock Communication's headquarters
is available at
http://www.harris.com/harris/whats_new/Building_exterior_front.JPG.
SOURCE Harris Corporation