Filtronic agrees to sell defence arm
MOBILE and radio frequency components manufacturer Filtronic today agreed to sell its defence electronics business for £13m.
US firm Teledyne, a subsidiary of Teledyne Technologies Incorporated, has signed a ‘definitive agreement’ to acquire the division from the Shipley-based business.
Filtronic’s defence electronics business designs and manufactures customised radio frequency, microwave and millimetre wave components and subsystems for the global defence industry and has operations in the United Kingdom and Australia.
The business posted operating profit of £1.3m on revenue of £14.5m for the 12 months ended May 31 and had gross assets of £7.4m.
Filtronic said the proceeds of the sale would be retained within its general corporate resources and it would now concentrate on its point to point business.
Teledyne, based in California, is a provider of electronic components, instruments and communications products for airlines and business aircraft, monitoring and control instruments for industrial and environmental applications and components, and subsystems for wireless and satellite communications.
Earlier this week, Filtronic said its point to point and UK defence divisions had helped it increase revenue from £38.4m to £54.6m for the year ended May 31.
The company also announced that chief executive Charles Hindson was to step down together with non-executive directors Professor Stephen Burbank and Ian Hardington. Hermant Mardia is to take over.
The company had confirmed that as a result of the defence business’s strong performance “several attractive” offers had been received and the detailed discussions with a preferred bidder were well advanced.
The past two quarters also saw the sale of Filtronic’s US defence and compound semiconductor business sold as well as a number of surplus properties. Its pension scheme problems have also been resolved.
Filtronic said the defence sale to Teledyne was subject to the Secretary of State for Defence not referring the transaction to the Office of Fair Trading before the date of completion, which is expected by the end of this month.
The company added that following the sale, its balance sheet would stand at around £40m and it was the board’s intention to declare a special dividend.
