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Robert Murphy: Cobham Targets Commercial Sectors Through $1.5B Deal for A&D Electronics Maker Aeroflex

Robert Murphy
Robert Murphy

England-based aerospace, defense and technology contractor Cobham plc has struck a deal to purchase microelectronic, testing and measuring equipment supplier Aeroflex Holding Corp. (NYSE: ARX) for around $900 billion in cash, or $10.50 per share.

Cobham would also assume $540 million of Aeroflex’s debt on March 31.

The companies expect to close the transaction in the third quarter of 2014, subject to receiving regulatory, shareholder and antitrust approvals, Aeroflex said Tuesday.

Cobham CEO Robert Murphy said his company made the deal as part of its “strategic objective to obtain more exposure to growing, commercially oriented end markets that increasingly demand more data, connectivity and bandwidth.”

The company sought to grow its commercial presence in May 2013 by purchasing mobile communications technology provider Axell Wireless for $130.9 million in cash and adding the latter company to Cobham’s antenna systems unit.

Cobham also sold the business formerly known as Sparta Inc. to Parsons Corp. nearly two years ago for $350 million

“We believe Aeroflex and Cobham are a natural fit and that Aeroflex will benefit from the larger scale, market presence, and resources of the combined organization, ” said Len Borow, Aeroflex CEO.

Aeroflex’s board of directors has approved the deal, while private-equity firms Veritas Capital Fund III LP, GS Direct LLC and Golden Gate Private Equity Inc. have indicated that they would vote to approve the acquisition, according to the announcement.

Goldman, Sachs & Co. and Stifel serve as Aeroflex’s financial advisers on the transaction, while Schulte Roth & Zabel LLP and Layton & Finger PA provided legal advice to Aeroflex.

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