Comtech Telecommunications Corp. [CMTL] on Nov. 23 said it has agreed to acquire Telecommunication Systems, Inc. [TSYS] in a deal to expand its domestic and international offerings of C4ISR and next-generation emergency communications services.
Comtech will pay $5 per TCS share for an enterprise value of $430.8 million. The two companies combined would have annual sales of about $671.4 million and 2,000 employees.
Comtech said the pending acquisition, which is expected to close by March 2016, gives it more scale and a diversified earning base, entry into commercial markets, including the public safety market that is demanding next-generation emergency 911 systems, establishes it as a prime contractor on several United States government contracts, and will result in cost synergies.
Comtech designs and produces communications solutions for telecommunications transmission, mobile data communications, and RF microwave amplifiers. TCS provides solutions for wireless communications for network operators, defense and public safety government agencies, and large companies.
Citigroup is Comtech’s financial adviser on the transaction and Lazard is advising TCS.