L-3 Board OKs Engility Spinoff Stock Distribution; Michael Strianese Comments

L3 Communications’ (NYSE: LLL) board of directors has approved the distribution of the remaining shares of its Engility subsidiary to all of its shareholders.

L-3 said every shareholder of record as of July 16 will receive one share of Engility for every six shares of L-3 stock.

“Engility will now be able to pursue new business opportunities unconstrained by organizational conflict of interest regulations,” said Michael Strianese, L-3’s chairman, president and CEO.

Engility will begin regular trading on the New York Stock Exchange July 18 with the EGL symbol.

L-3 currently has 97 million shares outstanding and that company’s shareholders will receive nearly 16 million shares of Engility common stock.

Engility will retain $10 million of cash on its balance sheet and incur $345 million of debt financing.

In preparation for the spinoff, L-3 has appointed several executive leaders to help transition Engility into an independent firm.

John Heller will lead the C2S2 division, Dr. Craig Reed will serve as senior vice president for strategic development, Michael Alber will serve as chief financial officer and Ray Guillaume will serve as treasurer.

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