EMCORE Announces Definitive Agreement to Acquire the L3Harris Space and Navigation Business
February 15 2022 - 8:00AM
EMCORE Corporation (Nasdaq: EMKR), a leading provider of advanced
mixed-signal products that serve the aerospace & defense,
communications, and sensing markets, announced today that it has
entered into a definitive agreement to acquire the assets and
liabilities of the L3Harris (NYSE: LHX) Space and Navigation
Business for approximately $5 million in an all-cash transaction.
EMCORE will host a conference call to discuss the acquisition on
February 15, 2022. See conference call information below.
“L3Harris Space and Navigation designs and builds some of the
most accurate Navigation products in the world. This acquisition
expands our Fiber Optic Gyroscope (FOG) product portfolio into the
Strategic Grade and Space-Qualified markets. We will also gain a
technical team with a sterling track record of development and
production of high-performance FOGs, Ring Laser Gyros (RLGs), and
reaction wheels,” said Jeff Rittichier, President and CEO of
EMCORE. “This acquisition further solidifies EMCORE’s position as
one of the largest independent inertial navigation providers in the
industry. This is an excellent fit strategically for EMCORE,
bringing Space and Navigation’s strong brand, inertial technology,
and important program wins. It also expands EMCORE’s market reach
into launch vehicle and space satellite markets, both of which are
seeing significant growth,” added Mr. Rittichier.
“The L3Harris Space and Navigation team will provide EMCORE with
the capability to accelerate expansion into a true navigation grade
FOG business with superior performance and accuracy compared to
competitors,” commented Albert Lu, Senior Vice President and
General Manager, Aerospace and Defense for EMCORE. “Combining this
business into EMCORE will allow us to provide customers with an
expanded product suite that serves a broader range of requirements
across both the tactical and navigation grade segments of the
market.”
Highlights of the transaction are as
follows:
- Expands EMCORE’s inertial navigation product portfolio and
addressable market, accelerating growth and contributing additional
revenue
- Includes Master Supply Agreements
(MSAs) for the BoRG (Booster Rate Gyro) and TAIMU (Tri-Axial
Inertial Measurement Unit) launch vehicle programs and creates
partnership opportunities with L3Harris to expand our mutual
business together
- EMCORE to be added as a preferred
supplier to L3Harris divisions for future business
opportunities
- Adds a complete set of capabilities to
design and test for space applications
- Shock, vibration, and thermal shock
measurement equipment
- X-ray capability and vacuum
chambers
- Includes a large number of rate tables
that can serve multiple product applications
- Expected to create material operating
synergies in engineering, manufacturing, and sales
- Expected to be non-GAAP EPS
accretive
Through the transaction, EMCORE will acquire all the
intellectual property, and outstanding assets and liabilities of
the L3Harris Space and Navigation business, including the 110,000
square foot leased production facility in Budd Lake, NJ. The
consummation of the transaction is subject to customary closing
conditions and is currently expected to close in the quarter ending
June 30, 2022.
Conference Call InformationThe company will
host a conference call Tuesday, February 15, 2022, at 9:00 a.m. ET
(6:00 a.m. PT). President & Chief Executive Officer, Jeff
Rittichier and Chief Financial Officer, Tom Minichiello will
discuss the acquisition and conduct a question and answer session.
The call will be available, live, by dialing 800-289-0720. For
international callers, please dial +1 313-209-5140. The conference
passcode number is 1238688. The call will be webcast live via the
Company's investor website at https://investor.emcore.com. Please
go to the site beforehand to register. A webcast will be available
for replay following the conclusion of the call.About
EMCORE EMCORE Corporation is a leading provider of
advanced mixed-signal products that serve the aerospace &
defense, communications, and sensing markets. Our
best-in-class components and systems support a broad array of
applications including navigation and inertial sensing, defense
optoelectronics, broadband communications, optical sensing, and
specialty chips for telecom and data center. We leverage
industry-leading Quartz MEMS, Lithium Niobate, and Indium Phosphide
chip-level technology to deliver state-of-the-art component and
system-level products across our end-market applications. EMCORE
has vertically-integrated manufacturing capability at its wafer
fabrication facility in Alhambra, CA, and Quartz MEMS manufacturing
facility in Concord, CA. Our manufacturing facilities maintain ISO
9001 quality management certification, and we are AS9100 aerospace
quality certified at our facility in Concord. For further
information about EMCORE, please visit http://www.emcore.com.
About L3Harris TechnologiesL3Harris
Technologies is an agile global aerospace and defense technology
innovator, delivering end-to-end solutions that meet customers’
mission-critical needs. The company provides advanced defense and
commercial technologies across space, air, land, sea and cyber
domains. L3Harris has more than $17 billion in annual revenue and
47,000 employees, with customers in more than 100 countries.
L3Harris.com.
Forward-looking statements:The information
provided herein may include forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934, as amended. Such
statements include statements regarding the anticipated benefits,
including anticipated revenue, of EMCORE’s acquisition of the Space
and Navigation business from L3Harris Technologies, market trends
and the anticipated relationship with L3Harris Technologies
following the transaction. These forward-looking statements are
based on management's current expectations, estimates, forecasts,
and projections about EMCORE and are subject to risks and
uncertainties that could cause actual results and events to differ
materially from those stated in the forward-looking statements,
including without limitation, the following: (a) uncertainties
regarding the effects of the COVID-19 pandemic and the impact of
measures intended to reduce its spread on our business and
operations, which is evolving and beyond our control; (b) the
rapidly evolving markets for the L3Harris Space and Navigation
business and EMCORE's products and uncertainty regarding the
development of these markets; (c) EMCORE's and the L3Harris Space
and Navigation business’s historical dependence on sales to a
limited number of customers and fluctuations in the mix of products
and customers in any period; (d) delays and other difficulties in
commercializing new products; (e) the failure of new products: (I)
to perform as expected without material defects, (ii) to be
manufactured at acceptable volumes, yields, and cost, (iii) to be
qualified and accepted by our customers, and (iv) to successfully
compete with products offered by our competitors; (f) uncertainties
concerning the availability and cost of commodity materials and
specialized product components that we do not make internally; (g)
actions by competitors; (h) acquisition-related risks, including
that (I) the closing of the acquisition remains subject to certain
conditions and obligations of the parties as set forth in the
definitive acquisition agreement, which agreement is subject to
termination prior to closing of the acquisition, (ii) the revenues
and net operating results obtained from the L3Harris Space and
Navigation business may not meet our expectations, (iii) the costs
and cash expenditures for integration of the L3Harris Space and
Navigation business operations may be higher than expected, (iv)
there could be losses and liabilities arising from the acquisition
of the L3Harris Space and Navigation business that we will not be
able to recover from any source, and (v) we may not realize
sufficient scale in our inertial navigation product line from the
acquisition of the L3Harris Space and Navigation business and will
need to take additional steps, including making additional
acquisitions, to achieve our growth objectives for this product
line and (I) other risks and uncertainties discussed under Item 1A
- Risk Factors in our Annual Report on Form 10-K for the fiscal
year ended September 30, 2021, as updated by our subsequent
periodic reports. Forward-looking statements contained in this
press release are made only as of the date hereof, and EMCORE
undertakes no obligation to update or revise the forward-looking
statements, whether as a result of new information, future events
or otherwise.
Contact:EMCORE Corporation
Tom MinichielloChief Financial Officer(626)
293-3400investor@emcore.com
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