Wed, 21 Dec 2016 | BUSINESS SALE
Aerospace specialist Meggitt has sold its drone targets division to defence tech firm Qinetiq for £57.5 million as it looks to target “attractive” international markets and boost its pension plan.
Target Systems manufactures drones and other aerial, land and naval targets that militaries use to shoot down in training sessions.
Qinetiq will acquire the business, based in the UK and Canada, on a cash- and debt-free basis. The division is expected to post revenues of £28 million and £5.5 million in profit in 2016.
Meggitt will channel £10.2 million from the deal to reduce a deficit in its pension plan. The company said the sale was consistent with its strategy of focusing on “businesses of scale in attractive markets where our leading positions offer greater potential for growth and operational efficiencies".
Under the deal Target Systems will form part of Qinetiq’s new international business unit and will be reported within Qinetiq’s Global Products division.
Qinetiq’s chief executive officer Steve Wadey said: “This acquisition accelerates the delivery of our strategic priorities to drive growth of our core capabilities in international markets, and to modernise and strengthen our ability to deliver world-class test and evaluation services.
“Meggitt Target Systems is a distinctive business with a strong management team and employees in Canada and the UK who are experts in the development and delivery of unmanned target systems and services. We know the business well having worked together for the past decade.”
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