Summary
L3Harris Technologies, Inc. (LHX) announced on February 4, 2020, a significant strategic divestiture of its airport security and automation business to Leidos, Inc. for a cash consideration of $1 billion. This business segment includes Security & Detection Systems and MacDonald Humfrey Automation solutions. This transaction is a key move for L3Harris as it aims to streamline its operations and focus on core competencies. The company plans to utilize the substantial proceeds from this sale to repurchase its own shares, which is expected to benefit shareholders by potentially increasing earnings per share and offsetting any dilution from previous activities. The deal is subject to standard closing conditions, including regulatory approvals, with an anticipated closing date in mid-2020. Investors should monitor the progress of regulatory approvals and the timing of the closing.
Key Highlights
- 1L3Harris Technologies to sell its airport security and automation business to Leidos, Inc.
- 2Sale price is $1 billion in cash.
- 3Divested business includes Security & Detection Systems and MacDonald Humfrey Automation.
- 4Proceeds expected to be used for share repurchases.
- 5Share repurchases are intended to offset dilution.
- 6Transaction is subject to customary closing conditions and regulatory approvals.
- 7Expected closing in mid-2020.