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TADIRAN NEW MAJORITY SHAREHOLDER IN EADS RACOMS

18 Nov 03. Tadiran Communications Ltd. will acquire 75 percent of EADS RACOMS GmbH und Co. KG based in Ulm, Germany. Tadiran and EADS, the number two in global aerospace and defence, have signed an acquisition agreement on Monday in Ulm. The implementation of the transaction is subject to the prior approval of the German cartel authorities. (See THALES REPORTS DOWNTURN IN TURNOVER)

EADS and Tadiran Communications consider their new partnership in RACOMS as the beginning of a strategic cooperation envisaged to include a variety of future defence and security issues.

The acquisition of RACOMS is part of Tadiran Communications’ strategy to enhance its presence and expand its product supplier business in Europe.

EADS Business Unit Defence and Communications Systems is the EADS system house offering the whole range of capabilities in command, control, communications and computing to meet the requirements of the defence customers. It continues its strategy to focus on and strengthen its Lead System integration business. Military Communications Systems remains a core business for EADS as a prerequisite for future network enabled operations.

Tadiran Communications intends to develop RACOMS as a leading military communications product supplier in Europe. Tadiran sees great marketing and business potential in the combination of its technological skills and know-how with those of RACOMS, and the utilization of Tadiran Communications Global Marketing Network for the marketing and sales of RACOMS products.

RACOMS, a reputable and leading supplier of HF radio technologies and products, specializes in the development and sales of military HF radio systems and advanced European and NATO compliant communication modems and protocols. RACOMS’ product lines include millimeter-wavelength communication systems, VHF power amplifiers and other communication and control systems. RACOMS participates in the Euro-Radio program under which a new, European software radio is being developed.

RACOMS is a well established German radio technology house and currently has 85 highly skilled employees in Ulm. In 2002, it generated total sales of € 45 million. It began its activities over 100 years ago as part of Telefunken and developed the first German military radio.

RACOMS applies its military expertise and capabilities also in the civilian markets. In the civilian area it has developed and supplies the communication systems for the super-fast Transrapid trains. RACOMS’ core competence includes program management, system engineering, system integration and hardware and software development.

Comment: This sale suggests a change in direction for EADS’ electronics segment from manufacture to supplying NEC expertise using a number of technologies. RACOMS is a major partner in the joint Franco/German software radio, an important addition for Tadiran’s range of products. This deal will also bring Tadiran expertise to EADS.

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