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Military Microwaves Supplement
Cobham, announced that it has sold M/A-COM Technology Solutions (MTS) to John Ocampo for $30 M in cash, $30 M in senior loan notes secured on the MTS assets and $30 M dependent on future revenue in the period 2010 to 2012.
The loan notes carry a rate of interest of 7.5 percent, which increases over time, and they are repayable in two equal tranches in December 2011 and 2012.
There are no conditions to closing and the transaction has been completed, the company said.
At the time of the acquisition of M/A-COM on May 13, 2008, Cobham said it planned to divest the commercial business segment MTA, as it was not core to the group's strategy.
Excluded from the sale are cash and the freehold of the Walker Building in Lowell, MA valued at $10 M.
As previously indicated, in the year ended September 30, 2007, MTS recorded revenue of some $275 M and operating profit of less than $10 M.
Given significant reductions in end market demand and the fact that Cobham has retained the MTS cash, the business may need working capital and, if required, Cobham will make available a 12-month secured credit facility for up to $12 M.
It is estimated that there will be no gain or loss on sale.
M/A-COM remains a value enhancing acquisition and is a critical part of Cobham's microwave subsystem strategy.
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