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By DAVID PITT
AP Business Writer
DES MOINES, Iowa (AP) -- Rockwell Collins Inc. said Wednesday it plans to buy part of a Utah-based company's business that provides realistic simulations for military mission rehearsal, command training and homeland security applications.
Rockwell-Collins, a Cedar Rapids-based manufacturer of cockpit avionics, radio and navigation systems and in-flight entertainment products for military, commercial and private aircraft said it will buy the simulation business of Evans & Sutherland for $71.5 million.
The deal, expected to close in the second quarter of this year, is subject to the approval of E&S shareholders and federal regulators.
The acquisition includes E&S facilities in Salt Lake City, Orlando, and the United Kingdom. About 200 E&S workers will join Rockwell Collins, the companies said in a statement.
E&S will keep its planetarium and other laser projector businesses and will continue to maintain its Salt Lake City headquarters. The company's digital theater equipment has been installed in 120 theaters worldwide.
The money from the transaction will be used to retire debt, make contributions to pension and retirement plans and for working capital, E&S said in a statement.
Rockwell Collins officials said the acquisition will not affect its annual earnings.
"Simulation and training offers a significant growth opportunity for our company," said Clay Jones, Rockwell Collins CEO. "The acquisition of these valuable assets from Evans & Sutherland will further enhance our simulation and training capabilities ad provide more robust solutions for our customers."
Last year, Rockwell bought Teldix GmbH, a German maker of military aviation electronics, for $94 million to broaden its European presence. As part of the deal, Rockwell Collins agreed to pay Teldix parent company Northrup Grumman $22 million in cash and assume certain liabilities.
Last month, Rockwell reported its ninth consecutive quarter of double-digit revenue growth. Profits were $104 million, or 59 cents a share compared to $90 million, or 50 cents a share a year ago. Sales were $881 million, an increase of 15 percent over the $763 million reported last year.
E&S stock soared 16.6 percent, or 81 cents, to $5.69 on the Nasdaq in midday trading. Rockwell Collins was trading up 58 cents, or 1.1 percent, at $50.54 on the New York Stock Exchange.
(Copyright 2006 by The Associated Press. All Rights Reserved.)
