EMS ANNOUNCES AGREEMENT WITH MACDONALD, DETTWILER
EMS Technologies Inc. has announced the signing of a definitive agreement for the sale of the assets and operating liabilities of its Space & Technology/Montreal division to MacDonald, Dettwiler and Associates Ltd. (MDA), Vancouver, BC, Canada. The parties are seeking to close the transaction during 2005, subject to the satisfaction of normal closing conditions and clearance by Canadian antitrust authorities.
The terms of the transaction were not announced, but EMS expects that the proposed sale will not result in further impairment charges related to the division, which has been reported as part of discontinued operations. Cash to be received at closing is expected to enable EMS to reduce its existing bank indebtedness by approximately $20 M.
"This agreement is an important milestone in our long-term strategic objective of focusing our financial and managerial resources on our continuing operations," said Alfred G. Hansen, president and chief executive officer of EMS. "Closing of the sale will strengthen our balance sheet, reduce our borrowing costs, and generally put us in position to pursue both internal and external opportunities to expand our remaining businesses. Space & Technology/Montreal has excellent people and technology, but its focus on commercial space programs, and its role in the Canadian space industry, fit much better with MDA's business than with the balance of our businesses. For similar reasons, we continue to work on the sale of our SatNet division, which is also carried as a discontinued operation; at the present time, a letter of intent for that transaction is in effect, and during the coming weeks we will be pursuing negotiations on definitive sales documentation."