L3Harris Technologies has finalised an agreement for the acquisition of its Commercial Aviation Solutions (CAS) business by an affiliate of TJC L.P. (formerly known as The Jordan Company) for US$800 million. The deal comprises a US$700 million cash purchase price and a US$100 million earnout linked to specific 2023 and 2024 financial targets, reflecting a roughly 15x EBITDA purchase multiple as of the last twelve months ending September 30, 2023. The transaction is anticipated to conclude in the first half of 2024, pending customary closing conditions and regulatory approvals.
Christopher E. Kubasik, Chair and CEO of L3Harris, stated, ‘Today's announcement aligns with our multi-year strategy to optimise our national security, technology-focused portfolio. Consistent with our capital allocation priorities, we intend to utilise the proceeds to expedite debt repayment, accelerating our progress towards our debt leverage objective.'
The CAS transaction encompasses the sale of L3Harris' surveillance joint venture and is subject to a right of first refusal. If exercised, an affiliate of TJC L.P. will acquire the remaining CAS assets.
L3Harris' CAS business, employing around 1,450 individuals, provides services such as pilot training, flight data analytics, avionics, and advanced air mobility solutions.
TJC, founded in 1982, is a middle-market private equity firm that has raised funds with original capital commitments in excess of US$22 billion and has a 41-year track record of investing in and contributing to the growth of many businesses across a wide range of industries including Diversified Industrials; Technology, Telecom & Power; Logistics & Supply Chain and Consumer & Healthcare. TJC has offices in New York, Miami, Chicago and Stamford. (£1.00 = US$1.27 at time of publication).
