Raytheon has moved to expand its intelligence-gathering products with an agreement to purchase mid-tier defence contractor Applied Signal Technology in a $490 million deal.
The acquisition ends a two-month bidding process for the Sunnyvale, California maker of signals intelligence and intelligence, surveillance and reconnaissance (ISR) systems.
The acquisition also follows Boeing's decision to acquire Argon ST in a bid to bolster its own portfolio of SIGINT products.
All but 10% of Applied Signal's sales come from classified customers, but the company has disclosed that it provides technology for the L-3 Communications MC-12 Liberty deployed by the US Air Force.
"Applied Signal aligns with our strategy of expanding participation in our customers' principal areas of need, particularly ISR systems," says Rick Yuse, president of Raytheon space and airborne systems.
Raytheon plans to combine Applied Signal's SIGINT and communications interceptors with its own radar and electro-optical/infrared sensors, Yuse says.
Such multi-intelligence packages have become popular in recent years, with the US Air Force deploying the MC-12, the army developing the Boeing enhanced medium range reconnaissance and surveillance system and the Defense Intelligence Agency operating the C-130-based Shadow Harvest system.
Raytheon will integrate Applied Signal into the Space and Airborne Systems division after closure of the sale, due in the first quarter of 2011.
On 22 October, Applied Signal confirmed its decision to consider bids from potential buyers.
"Raytheon's technology portfolio, highly developed infrastructure and broad operating and development capabilities will create strong new capabilities for our customers," says William Van Fleet, chief executive of Applied Signal.
Source: Flight International
