– L-3 Continues to Trade as NYSE: LLL –
NEW YORK--(BUSINESS WIRE)--Jul. 17, 2012--
L-3 Communications Holdings, Inc. (NYSE: LLL) announced today that it
has successfully completed the previously announced spin-off of its
subsidiary, Engility Holdings, Inc. L-3 shareholders of record as of
July 16, 2012 (the “record date”) received one share of Engility common
stock for every six shares of L-3 common stock held on the record date.
The spin-off has been structured to qualify as a tax-free distribution
to L-3 shareholders for U.S. federal tax purposes, except for cash
received in lieu of fractional shares. Following the spin-off, L-3 will
report Engility financial results as discontinued operations beginning
with L-3's 2012 third quarter, along with all prior periods.
Engility will begin trading regular-way as an independent publicly
traded company on the New York Stock Exchange under the ticker symbol
EGL on July 18, 2012.
“I am pleased to announce the completion of the spin-off, and the
beginning of an exciting new chapter for both L-3 and Engility,” said
Michael T. Strianese, chairman, president and chief executive officer of
L-3. “We believe that this transaction positions both L-3 and Engility
to capitalize on their strengths, pursue new business opportunities, and
become leaders in their respective markets. We thank everyone at
Engility for their contributions to L-3 and for their dedicated service
to their customers, and wish them continued success in the years to
come.”
L-3 has retained its cyber, intelligence and security solutions
businesses, which will collectively be called National Security
Solutions going forward. These businesses develop unique solutions to
address growing challenges for U.S. Department of Defense, intelligence
and global security customers.
“Following the transaction, L-3 will have a sharper focus on areas that
are core to our strategy of providing market-leading, value-added
products and solutions to our customers,” continued Mr. Strianese. “Our
capabilities are well-positioned within areas that are priorities in the
current environment and will remain priorities in the future. Looking
ahead, we will continue to execute against our strategic goals,
generating value for both our customers and our shareholders.”
L-3 reiterated its 2012 financial guidance provided on June 26, 2012 and
that it intends to use the net proceeds of approximately $325 million
from Engility in connection with the spin-off to redeem $250 million
aggregate principal amount of its 6⅜% Senior Subordinated Notes due in
2015 on July 26, 2012 and repurchase approximately $75 million of its
outstanding shares.
About L-3
Headquartered in New York City, L-3 employs approximately 51,000 people
worldwide and is a prime contractor in C3ISR (Command,
Control, Communications, Intelligence, Surveillance and Reconnaissance)
systems, aircraft modernization and maintenance, and national security
solutions. L-3 is also a leading provider of a broad range of electronic
systems used on military and commercial platforms.
To learn more about L-3, please visit the company’s website at www.L-3com.com.
L-3 uses its website as a channel of distribution of material company
information. Financial and other material information regarding L-3 is
routinely posted on the company’s website and is readily accessible.
Forward-Looking Statements
Certain of the matters discussed in this release that are predictive in
nature, that depend upon or refer to events or conditions or that
include words such as ‘‘expects,’’ ‘‘anticipates,’’ ‘‘intends,’’
‘‘plans,’’ ‘‘believes,’’ ‘‘estimates,’’ and similar expressions
constitute forward-looking statements. Although we believe that these
statements are based upon reasonable assumptions, they are subject to
several risks and uncertainties, and therefore, we can give no assurance
that these statements will be achieved. Such statements will also be
influenced by factors which include, among other things: our dependence
on the defense industry and the business risks peculiar to that
industry, including changing priorities or reductions in the U.S.
Government defense budget; backlog processing and program slips
resulting from delayed funding of the Department of Defense (DoD)
budget; our reliance on contracts with a limited number of agencies of,
or contractors to, the U.S. Government and the possibility of
termination of government contracts by unilateral government action or
for failure to perform; the extensive legal and regulatory requirements
surrounding our contracts with the U.S. or foreign governments and the
results of any investigation of our contracts undertaken by the U.S. or
foreign governments; our ability to retain our existing business and
related contracts (revenue arrangements); our ability to successfully
compete for and win new business and related contracts (revenue
arrangements) and to win re-competitions of our existing contracts; our
ability to identify and acquire additional businesses in the future with
terms that are attractive to L-3 and to integrate acquired business
operations; the impact of any strategic initiatives undertaken by us,
including but not limited to the spin-off of Engility, and our ability
to achieve anticipated benefits; our ability to maintain and improve our
consolidated operating margin and total segment operating margin in
future periods; our ability to obtain future government contracts
(revenue arrangements) on a timely basis; the availability of government
funding or cost-cutting initiatives and changes in customer requirements
for our products and services; our significant amount of debt and the
restrictions contained in our debt agreements; our ability to continue
to retain and train our existing employees and to recruit and hire new
qualified and skilled employees as well as our ability to retain and
hire employees with U.S. Government security clearances; actual future
interest rates, volatility and other assumptions used in the
determination of pension benefits and equity-based compensation, as well
as the market performance of benefit plan assets; our collective
bargaining agreements, our ability to successfully negotiate contracts
with labor unions and our ability to favorably resolve labor disputes
should they arise; the business, economic and political conditions in
the markets in which we operate, including those for the commercial
aviation, shipbuilding and communications markets; global economic
uncertainty; the DoD’s contractor support services in-sourcing and
efficiency initiatives; events beyond our control such as acts of
terrorism; our ability to perform contracts (revenue arrangements) on
schedule; our international operations; our extensive use of fixed-price
type contracts as compared to cost-plus type and time-and-material type
contracts; the rapid change of technology and high level of competition
in the defense industry and the commercial industries in which our
businesses participate; our introduction of new products into commercial
markets or our investments in civil and commercial products or
companies; the outcome of litigation matters, including in connection
with jury trials; results of audits by U.S. Government agencies; results
of ongoing governmental investigations, including potential suspensions
or debarments; the impact on our business of improper conduct by our
employees, agents or business partners; anticipated cost savings from
business acquisitions not fully realized or realized within the expected
time frame; the outcome of matters relating to the Foreign Corrupt
Practices Act (FCPA) and similar non-U.S. regulations; ultimate
resolution of contingent matters, claims and investigations relating to
acquired businesses, and the impact on the final purchase price
allocations; competitive pressure among companies in our industry; and
the fair values of our assets, which can be impaired or reduced by other
factors, some of which are discussed above.
For a discussion of these and other risks and uncertainties that could
impair our results of operations or financial condition, see ‘‘Part I —
Item 1A — Risk Factors’’ and Note 19 to our audited consolidated
financial statements, included in our Annual Report on Form 10-K for the
year ended December 31, 2011, and any material updates to these factors
contained in any of our future filings.
Our forward-looking statements are not guarantees of future performance
and the actual results or developments may differ materially from the
expectations expressed in the forward-looking statements. Given these
uncertainties, you should not place any reliance on these
forward-looking statements. These forward-looking statements also
represent our estimates and assumptions only as of the date that they
were made. We expressly disclaim a duty to provide updates to these
forward-looking statements, and the estimates and assumptions associated
with them, after the date of this release to reflect events or changes
in circumstances or changes in expectations or the occurrence of
anticipated events.
Source: L-3 Communications Holdings, Inc.
L-3 Communications
Corporate Communications
212-697-1111
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