L-3 Communications Acquires MacDonald Humfrey Automation

Defense contractor L-3 Communications Holdings Inc. on Tuesday said it acquired MacDonald Humfrey Automation Ltd. for about £ 224 million ($280 million), beefing up its position in the global aviation-security market.

Luton, U.K.-based MacDonald Humfrey develops automated airport-checkpoint security scanners, some of which American Airlines Group Inc. and United Continental Holdings Inc. introduced at Chicago's O'Hare International Airport this month. The scanners are widely used in Europe and elsewhere.

MacDonald Humfrey, which has 350 employees, will report to the security and detection systems division of the L-3's electronic systems business segment and will operate under the L-3 MacDonald Humfrey name. L-3 MacDonald Humfrey is projected to generate sales of roughly £ 108 million ($135 million) in 2017.

The purchase price is subject to an upward adjustment of up to £ 30 million (about $37.5 million) based on MacDonald Humfrey's post-acquisition performance for the next three years.

New York-based L-3 employs about 38,000 people world-wide and raked in $10.5 billion in sales for 2015.

L-3, which has focused on developing its ClearScan carry-on baggage screening system and ProVision personnel screener, said the acquisition will enhance its ability to deliver "scalable, operationally based networked security systems."

Write to Anne Steele at [e-mail]

(END) Dow Jones Newswires

November 22, 2016 17:45 ET (22:45 GMT)

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