8-KAcquisitions & DispositionsExhibits & Filings

L3HARRIS TECHNOLOGIES, INC. /DE/ 8-K Report, Acquisition Completed (May 4, 2017)

Filed May 4, 2017For Securities:LHX

Summary

L3Harris Technologies (formerly Harris Corporation) announced the completion of the sale of its government services business on April 28, 2017, to MHVC Acquisition Corp., an affiliate of Veritas Capital Fund Management. This business unit, previously part of the Critical Networks segment, encompassed services in space and intelligence, advanced solutions, civil and healthcare, defense, NASA and range, and managed satellite and terrestrial communications. The transaction was valued at $690 million in cash, with Harris Corporation receiving net proceeds of approximately $650 million after adjustments and transaction expenses. This divestiture represents a strategic shift for L3Harris, allowing it to focus on its core areas. The proceeds from the sale are expected to strengthen the company's financial position and provide flexibility for future investments or capital allocation. Investors should note that the air traffic management business and the Pacific Missile Range Facility program were explicitly excluded from this sale. The company also provided unaudited pro forma financial statements to reflect the impact of this transaction on its historical income statements.

Key Highlights

  • 1Completion of the sale of the Harris Corporation's government services business on April 28, 2017, for a cash purchase price of $690 million.
  • 2The buyer is MHVC Acquisition Corp., an affiliate of Veritas Capital Fund Management, L.L.C.
  • 3Net cash proceeds received by the company amounted to approximately $650 million after adjustments and transaction expenses.
  • 4The divested business includes services in space and intelligence, advanced solutions, civil and healthcare, defense, NASA and range, and managed satellite and terrestrial communications.
  • 5The air traffic management business and the Pacific Missile Range Facility program were excluded from the sale.
  • 6Harris Corporation entered into a transition services agreement to provide certain services for the divested business for up to 18 months.
  • 7Unaudited Pro Forma Condensed Consolidated Statements of Income for fiscal years 2014-2016 were furnished to show the impact of the transaction.

Frequently Asked Questions

L3Harris Technologies (then Harris Corporation) sold its government services business, which was operated within its former Critical Networks segment. This included services related to space and intelligence, advanced solutions, civil and healthcare, defense, NASA and range, and managed satellite and terrestrial communications.

The sale was completed for $690 million in cash, and L3Harris received approximately $650 million in net cash proceeds after accounting for transaction expenses and purchase price adjustments. The company also furnished unaudited pro forma financial statements to illustrate the historical impact.

Yes, L3Harris entered into a transition services agreement to provide certain services for the divested business for a period of up to 18 months. They also entered into an intellectual property agreement and other ancillary commercial agreements.

The company explicitly stated that its air traffic management business and the Pacific Missile Range Facility program were not part of this transaction.