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Acq - P2P | Acquired



About Logicon

Logicon is a provider of advanced information technology solutions, engineering and business services for government and commercial clients. Logicon's expertise spans such areas as information systems integration; command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR); enterprise hardware and software solutions; training and simulation; base and range support; signals intelligence; space systems; health informatics, and specialized scientific, engineering and technical services.

Logicon Headquarter Location

Torrance, California,

United States

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Latest Logicon News

Northrop to Purchase Logicon in a $750 Million Stock Swap - The New York Times

Jan 30, 2019

Northrop to Purchase Logicon in a $750 Million Stock Swap By Kenneth N. Gilpin May 6, 1997, Section D, Page 7 Buy Reprints TimesMachine is an exclusive benefit for home delivery and digital subscribers. Seeking to bolster its position in the highly competitive market for military electronics and information services, the Northrop Grumman Corporation said yesterday that it had agreed to buy Logicon Inc., a military information technology company, in a stock swap valued at $750 million. The final value of the deal has not yet been determined. Northrop Grumman said it would exchange at least 0.5661 and at most 0.6919 of its shares for each of Logicon's 14.3 million shares outstanding. The fraction will be determined by dividing $52 by the average closing price for Northrop Grumman common stock during a 30-day period before mailing the proxy statement for the acquisition. During a conference call with analysts and reporters, Kent Kresa, Northrop Grumman's chairman and chief executive, characterized the information technology business as offering ''terrific growth opportunities,'' even though the company acknowledged that the acquisition will pare earnings this year and could have an adverse impact on its 1998 results. Analysts said they supported the transaction, but acknowledged Northrop was paying full price. Northrop Grumman shareholders were less impressed. On the New York Stock Exchange yesterday, Northrop Grumman's stock slumped $2.50, or 2.9 percent, to $84.50 a share. But Logicon's shares soared, rising $9.375, or 23 percent, to $49.75. ''The surprise of the day is not so much that Logicon was sold but that Northrop Grumman was the one that bought them,'' said Byron K. Callen, an analyst at Merrill Lynch & Company. ''But I think there is a good fit here. They paid a price for it, but there is a good fit.'' Before making the deal with Logicon, Mr. Callen and other analysts said that Northrop's only real presence in the information technology business was a data processing operation that had been a part of Grumman. That division generates about $400 million a year in revenues, the analysts said. Logicon, which is based in Torrance, Calif., will report the results of its most recent fiscal year later this month. During the conference call, John R. Woodhull, Logicon's chairman and chief executive, said the company would post revenues of a little more than $560 million. ''Without Logicon, Northrop Grumman would have had a difficult time growing the business,'' said Peter Aseritis, an analyst at Credit Suisse First Boston. ''Now it is a $1 billion business with annual growth potential of around 10 percent, and possibly more.'' During the conference call, Mr. Kresa said the Federal Government spent more than $26 billion on information technology last year, and that the market was ''potentially enormous.'' ''This will enable us to strengthen, broaden and grow our existing information technology business,'' he said. Products that Logicon supplies to the Pentagon include computer systems it uses to analyze possible outcomes of military missions. It also operates computers that simulate battlefield conditions used in training soldiers, and is helping to update aging information systems. Even as they acknowledged the market's potential, analysts said that many others had long since come to the same conclusion. ''There are a lot of other competitors,'' Mr. Callen said, rattling off names like Boeing, Computer Sciences, EDS and AT&T. ''I don't know how relevant that $26 billion number is,'' he said. ''But they are a $1 billion company in a $26 billion market. That is not exactly critical mass.'' The transaction is subject to the approval of Logicon shareholders and Federal regulators, and is expected to be completed within 60 days, Northrop Grumman said. Once completed, Northrop Grumman said it would create a new Logicon Information Technology division, which will be headed by Mr. Woodhull. Salomon Brothers served as financial adviser to Northrop Grumman on the transaction. Goldman, Sachs & Company provided financial advice to Logicon. Advertisement

  • Where is Logicon's headquarters?

    Logicon's headquarters is located at Torrance.

  • What is Logicon's latest funding round?

    Logicon's latest funding round is Acq - P2P.

  • Who are the investors of Logicon?

    Investors of Logicon include Northrop Grumman.

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