Wartsila Corporation announces that its acquisition of the Germany based L-3 Marine Systems International (MSI) has been finalized and control of the company will be transferred to Wartsila with effect from 1st June 2015.
In December 2014, Wartsila announced that agreement had been reached to acquire MSI from NYSE-listed L-3 Communications Holdings Inc. using financing from existing cash resources and credit facilities. The transaction is valued at MEUR 285 (enterprise value). After estimated adjustments of cash, working capital, and pension liabilities, the purchase price is estimated to be MEUR 295. The final purchase price will be determined based on closing accounts. The acquisition received Korean merger control clearance in March and EU clearance in April.
Electrical and Automation (E&A) systems are of increasing importance since the operation of ships is becoming ever more sophisticated. Wartsila’s strong position in the development of technologies that enhance operational efficiency will be further strengthened with the addition of MSI’s broad range of capabilities. The company’s portfolio comprises several well-known product brands, including SAM Electronics, Valmarine, Lyngs? Marine, Dynamic Positioning & Control Systems, Jovyatlas Euroatlas, ELAC Nautik, FUNA, GA International and APSS.
MSI has extensive experience in supplying automation, navigation and electrical systems, dynamic positioning technology, as well as sonar and underwater communications technology for a variety of vessel types and offshore installations.
The MSI organization, which currently comprises more than 1700 employees working from 38 locations in 14 countries, will be integrated with Wartsilas existing E&A business. The acquisition will notably enhance Wartsila’s E&A offering and market position.
In 2014 MSI reported net sales of MEUR 404 and an operating profit of 7%. Wartsila foresees that the new unit will be able to capture new market opportunities and improve operational efficiency for its customers, thereby increasing both the sales and profitability of the business. The acquisition is expected to be EPS accretive as of 2015. Further information on the financial impact will be provided once closing accounts have been finalized.
