12 Jun 06. Ericsson, the telecoms equipment group said on Monday that it had signed a deal to sell its defence business to Saab, the Swedish aerospace and defence group, for SKr3.8bn ($521.5m). Under the terms of the deal, Saab will take control of Ericsson Microwave Systems and Ericsson’s 40 per cent holding in Saab Ericsson Space subject to regulatory approval. However, Ericsson said that it would retain control of the national security and public safety business as well as parts of the power systems business. The deal will affect about 1,250 employees and is expected to close in September. Ericsson said that the benefit from the deal would roughly offset the costs associated with the acquisition of Marconi, giving a neutral effect on Ericsson’s income after financial items for 2006. (Source: FT)
06 Jun 06. A £6.7m order from the Ministry of Defence, coupled with a good recovery in the electronic tubes division, helped e2v to double pre-tax profit in the year to March. The former Marconi company, which floated in the summer of 2004, also reported a strong second half at its sensors division, more than compensating for a weak first half. Pre-tax profit jumped from £5.6m to £11.9m. Adjusted for exceptionals, profit was 39 per cent higher at £13.6m on sales up from £100.5m to £112.3m. Earnings rose from 6.93p to 14.81p. The proposed final dividend of 4.25p takes the total for the year from 4.53p to 6.25p. ABN Amro, the company’s broker, eased its forecast for the current year adjusted profits up 2 per cent to £15.1m, rising to £17.2m next year. (Source: FT)
08 Jun 06. Lockheed Martin Corp. said it completed its acquisition of Savi Technology Inc., which develops shipment-tracking systems using radio frequency identification. Terms were not disclosed. The transaction was announced in May. Savi’s hardware and software are used by the U.S. Department of Defense, international defense agencies and companies to monitor security and environmental conditions, Lockheed Martin said.
16 Jun 06. China could soon witness a rare hostile takeover battle after the chief executive of Sany Heavy Industry insisted on Thursday his company would make a bid this month for rival Xugong Group Construction Machinery, which then dismissed him as “irresponsible”. Xiang Wenbo said the heavy machinery maker would present by July a takeover proposal to the main shareholders of Xugong and the relevant authorities. In an interview, Mr Xiang said his company could finance the bid from bank loans, bond issues or an offer of new shares, or it could bring in strategic investors. Bankers have questioned Sany’s financial resources, given that Xugong has annual sales three times larger.Carlyle Group, the US private equity firm, has already agreed to pay $375m for a controlling stake of Xugong. However the Ministry of Commerce has yet to approve the acquisition. The Carlyle offer has become one of a series of takeover bids by overseas companies that appear to have been held up by a nationalist backlash. (Source: FT)
14 Jun 06. Thales, the French electronics and defence group, and Diehl of Germany, are to create a joint enterprise in electronic systems for munitions. Diehl will control 51 per cent of the new company, which will be called Junghans Microtec GMBH, and Thales the remainder. It is expected to generate annual turnover of 70m euros with 350 employees. (Source: Abstracted from Les Echos/FT.com)
14 Jun 06. Against the background of the Eurosatory land arms fair in Paris, the French defence minister, Michele Alliot-Marie, said that Giat, the state-owned land arms maker, could open itself to new European partnerships, and that teaming up with a French partner beforehand was to be desired. Luc Vigneron, the CEO of Giat, expressed similar hopes, recalling his ambition to create a ‘multi-domain’ group, without ruling out a French partnership as a first step. All eyes then turned to Thales, the French electronics and defence group, who is the obvio