Harris sells Broadcast Division for $225 million
5 months, 2 weeks ago
Broadcast operation, including Quincy facility, expected to remain "largely intact"
Quincy Mayor John Spring was optimistic about the Harris sale.
"I do think this is good news," Spring said. "The Harris folks have been great to work with, especially Chris Parsons (Vice President of Global Operations for Harris)."
According to William Brown, president and CEO of Harris, the sale is part of a strategy to focus on its core businesses.
“As previously communicated, we plan to repurchase up to $200 million of our shares after the deal closes,” said Brown. “This is in addition to the $200 million of share repurchases already planned for fiscal 2013 and reflects our ongoing commitment to effectively deploy capital, including returning cash to shareholders."
Phil Conover, interim president of the Great River Economic Development Foundation, said The Gores Group has a successful record of buying and improving telecommunications companies.
"They have strong history,' Conover said. "They have a 25 year record. I'm cautiously optimistic."
The Gores Group is expanding its broadcast holdings with a $225 million deal to buy Harris’ broadcast business. Harris announced plans to sell the division in May to focus on its government and military technology business. By selling to a private equity firm, the Harris Broadcast operation is expected to largely remain intact.
“In Harris Broadcast Communications, we are investing in a proven technology leader with great products and a great team,” Gores managing partner Ryan Wald says in a statement. “We are excited to provide the capital and support to transition this division to a strong and independent company further enabling it to continue developing and delivering market leading technologies to its customers.”
Under the terms of the deal, Gores will pay $160 million in cash, plus there will be a 15 million subordinated promissory note and an earnout of up to $50 million based on future performance of the business.
Harris CEO Bill Brown says they will use the proceeds of the sale to buy back up to $200 million worth of company stock. “The sale of Broadcast Communications reflects our strategy to optimize our business portfolio and focus on our core businesses,” he says.
Gores is also a part-owner of Dial Global.