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Teledyne Technologies Inc. and Intelek plc jointly announced that they have reached agreement on the terms of a recommended cash offer to be made by Teledyne for the entire issued and to be issued ordinary share capital of Intelek (the “Offer”). Under the terms of the Offer, Intelek’s ordinary shareholders will receive 32 pence in cash for each Intelek Share valuing the entire existing issued ordinary share capital of Intelek at approximately £28 M.
Intelek is a group of companies that primarily designs and manufactures electronic systems for satellite and microwave communication. Through its Paradise Datacom division, Intelek designs and manufactures satellite modems, transceivers, block up-converters, solid state power amplifiers, low noise amplifiers and associated equipment for the terrestrial segment of the satellite communications market. Intelek’s Labtech division is a manufacturer of microwave circuits and components primarily for the defense electronics, global telecommunications, space and satellite communications markets. Intelek’s CML division manufactures precision machined and composite aerostructures for military and commercial aircraft. Following completion of an acquisition, Teledyne will consider strategic alternatives for CML, which may after review include a sale of the business.
“The proposed acquisition of Intelek should further expand Teledyne’s capabilities in microwave systems, and we are delighted that the directors of Intelek have decided unanimously to recommend the Offer to the Intelek Shareholders,” said Robert Mehrabian, Chairman, President and Chief Executive Officer of Teledyne. “The operations of Intelek are highly complementary with Teledyne’s existing microwave businesses. In particular, Paradise Datacom’s high power solid state amplifiers and modems for commercial customers complement Teledyne’s strong position in broadband high power traveling wave tube (TWT) and lower power solid state subsystems, primarily for military customers. By combining our capabilities, we believe that Teledyne will be able to offer, over time, an enhanced range of complete high power TWT and GaAs and GaN-based solid state amplifier systems for communications, radar and electronic warfare applications.”
“The directors of Intelek have focused our strategy on further developing our satellite and microwave communications businesses,” said Ian Brodie, Chief Executive Officer of Intelek. “This offer is at a substantial premium and we unanimously recommend that shareholders accept this Offer. Finally, we are pleased that Teledyne has indicated that, under its ownership, Teledyne will continue to support and further develop Intelek’s microwave businesses and employees.”
The aggregate value for the transaction will be approximately £35 M (or approximately $52 M) taking into account Intelek’s stock options, net debt and pension deficit. For the year ended March 31, 2010, Intelek had sales of approximately £38 M.
Intelek’s directors have unanimously recommended that Intelek Shareholders accept the Offer. In addition, Teledyne has received irrevocable undertakings from Intelek directors and the company’s largest shareholder to accept the offer.