Tue, Jan. 26, 10:33 AM
- Leidos (LDOS -6.9%) is off sharply following news of its planned merger with Lockheed Martin's (LMT -3.3%) Information Systems & Global Solutions (IS&GS) unit.
- Lockheed, meanwhile, is seeing its Q4 beat overshadowed by the company's light 2016 EPS guidance - $11.45-$11.75 vs. a consensus of $12.23. Sales guidance of $49.5B-$51.5B is mostly above a $49.52B consensus. The outlook still covers IS&GS, and also includes a full year of operations from recently-acquired Sikorsky Aircraft.
- The merger is expected to close in 2H16; a slew of banks are providing Leidos with deal financing. Leidos: "This combination is expected to add large, complex IT system implementation and operation experience, and additional federal and international IT solutions and services work to the Leidos portfolio, providing more venues to sell value added services such as cybersecurity and analytics." (more details on IS&GS)
- Lockheed's Q4 results, earnings release
Tue, Jan. 19, 3:18 PM
- Leidos Holdings (LDOS +1.6%) is nearing a deal to merge with the government information technology and services businesses being sold by Lockheed Martin (LMT -0.8%), in a deal that could value the assets at ~$5B, Reuters reports.
- Leidos is said to have submitted an offer earlier this month that prevailed over rival U.S. defense contractor CACI International (CACI -2.1%) and is in the process of finalizing terms with LMT, and plans to merge with the LMT businesses for sale under a Reverse Morris Trust, which allows a parent company to divest a unit in a tax-efficient manner.
- A deal, if finalized, could be announced as early as next week, according to the report.
Dec. 18, 2015, 2:26 AM
- CACI International (NYSE:CACI) has emerged as the top contender for Lockheed Martin's (NYSE:LMT) IT business, sources told Reuters.
- Leidos (NYSE:LDOS) and Engility (NYSE:EGL), which were also considering offers, feel discouraged by the prospects of the assets for sale following meetings with the company.
- Lockheed may also decide to spin off the business, which has annual revenues of $4.5B-$5B, rather than sell it outright.
Nov. 3, 2015, 2:59 PM
- Lockheed Martin (LMT -0.6%) says it has received final regulatory approval from China for its $9B acquisition of Sikorsky Aircraft from United Technologies (UTX +0.8%), and expects the deal to close on Friday.
- Separately, Bloomberg reports LMT is exploring a sale of $600M in alternative assets to reduce exposure to P-E funds; the asset portfolio is said to be held by a subsidiary that manages employees’ post-retirement plans, and a deal may be completed by year-end.
- S&P downgraded LMT’s debt rating on Monday, citing its "expectation of a significant deteriorating in Lockheed’s forecasted credit metrics” as the company continues returning excess cash to shareholders despite the debt-financed acquisition of Sikorsky.
Oct. 15, 2015, 4:51 AM
- According to Reuters sources, Lockheed Martin's (NYSE:LMT) purchase of Sikorsky Aircraft from United Technologies (NYSE:UTX) could close by late October or early November, well before the initial year-end target.
- Lockheed announced last month that officials in the U.S., South Korea and Japan had cleared the $9B acquisition, but was still waiting for other regulatory approvals.
- China and the European Union are expected to support the deal next week.
Sep. 24, 2015, 9:51 AM
- U.S. officials have approved Lockheed Martin's (LMT -1.3%) $9B takeover of United Technologies' (UTX -1.3%) Sikorsky Aircraft unit.
- Authorities in Japan and South Korea previously cleared the deal, but the company is still waiting for other regulatory approvals.
- Multiple sources say Lockheed is now likely to close the acquisition well before the end of 2015, as initially expected.
Sep. 8, 2015, 6:53 PM
- Aerojet Rocketdyne Holdings (NYSE:AJRD) has submitted a $2B offer to buy United Launch Alliance, a 50-50 joint venture of Lockheed Martin (NYSE:LMT) and Boeing (NYSE:BA), Dow Jones reports.
- The two sides are in advanced talks about a deal, and an announcement could come as early as the first part of next week, according to the report.
- The two companies might welcome the bid, according to a source cited in the report, given increased competition from SpaceX which is likely to cut into ULA's revenues and earnings in coming years.
Jul. 20, 2015, 12:49 PM
- Lockheed Martin (LMT +1.9%) hit a "trifecta" today following the announcement of its $9B purchase of Sikorsky Aircraft from United Technologies (UTX -0.7%), according to the analyst team at UBS.
- The deal cements LMT's dominance in weapons making and opens key foreign markets for the company, which has annual revenues of $45B; analysts do not expect antitrust objections since LMT does not build helicopters.
- LMT also announced a strategic review of a large portion of its government IT and services portfolio for a potential sale or spinoff.
- Also, LMT's Q2 results came in well ahead of consensus, with 3% revenue growth well ahead of the UBS forecast for a 6% decline and 12% margins coming in 30 bps better than expected.
- UTX shares also are worth buying, according to Sterne Agee CRT analyst Peter Arment, who says the Sikorsky sale is a "positive first step" in the transformation of its business portfolio and allows the company to return a large amount of cash to shareholders without reducing balance sheet flexibility; while Sikorsky generated ~10% of UTX sales, it only accounted for 6.5% of its profits.
Jul. 20, 2015, 1:42 AM
- Lockheed Martin (NYSE:LMT) has agreed to buy United Technologies' (NYSE:UTX) Sikorsky Aircraft for over $8B, Reuters reports, cementing a deal that would give the Black Hawk helicopter to the maker of the F-35 fighter jet.
- The acquisition of Sikorsky, which had more than 15K employees and net sales of $7.5B at the end of last year, would be the biggest by Lockheed since its $10B takeover of Martin Marietta two decades ago.
- Pentagon officials said last week they would carefully evaluate any sale to maintain competition and avoid market distortions.
Jul. 8, 2015, 6:43 PM
- Lockheed Martin (NYSE:LMT) and Textron (NYSE:TXT) have emerged as final contenders to buy United Technologies' (NYSE:UTX) Sikorsky Aircraft unit, which could be valued at ~$8B, Reuters reports.
- UTX reportedly is weighing offers from the two companies and may come to a decision by the end of the month, but it still could decide against an outright sale and instead spin off Sikorsky to shareholders in a tax-free deal.
- TXT, whose ~$12B market cap is only one fifth the size of LMT's $60B, is said to have reached out to P-E firms to put together a cash bid.
- Boeing (NYSE:BA), which had expressed interest in a potential deal, is no longer active in the sale process, and Airbus (OTCPK:EADSF, OTCPK:EADSY) is not in the running, according to the report.
- UTX +1.5% AH.
Jun. 10, 2015, 2:38 AM
- After receiving several offers, United Technologies' (NYSE:UTX) board of directors is scheduled to meet later this week to review the options for its $8B Sikorsky aircraft business.
- UTC is considering two tax-efficient transactions for Sikorsky: a spin-off or combination with peer Textron (NYSE:TXT).
- Alternatively, Sikorsky may be sold outright to another company. Lockheed Martin (NYSE:LMT), Boeing (NYSE:BA) and Airbus (OTCPK:EADSY) have all expressed interest.
May 19, 2015, 6:51 PM
- United Technologies (NYSE:UTX) is talking to potential buyers for its Sikorsky Aircraft business, WSJ reports, raising the prospect that a spinoff could turn into a sale.
- Boeing (NYSE:BA), Airbus (OTCPK:EADSF, OTCPK:EADSY) and Lockheed Martin (NYSE:LMT) reportedly are among the companies exploring bids or a potential minority stake in the helicopter maker.
- Analysts estimate Sikorsky could fetch ~$10B in a full sale.
Oct. 30, 2014, 9:23 AM
- Lockheed Martin (NYSE:LMT) has entered into a definitive agreement to acquire Systems Made Simple, a provider of health IT solutions to the U.S. government.
- "Systems Made Simple's capabilities in engineering health technology solutions are a natural extension of our existing health IT portfolio, and will enable us to deliver a broader portfolio of capabilities to meet our healthcare customers' current and future needs," says CEO Marillyn Hewson.
- The acquisition is expected to close within 30 days.
Aug. 25, 2014, 10:57 AM
- Lockheed Martin (LMT +0.9%) has completed its acquisition of nearly all assets of Sun Catalytix, a company that specializes in advanced engineering and chemistry of energy-related technologies.
- The operation will become a wholly-owned subsidiary and will be known as Lockheed Martin Advanced Energy Storage.
Aug. 19, 2014, 7:49 AM
Jun. 30, 2014, 9:52 AM
- Lockheed Martin (LMT -0.4%) has agreed to acquire Zeta Associates in pursuit of expanding its intelligence, surveillance and reconnaissance portfolio. The deal is expected to close in Q3 of 2014. Upon closing, Zeta Associates will be a wholly-owned subsidiary of Lockheed Martin. (PR)