Leidos to acquire L3Harris Technologies’ Security Detection and Automation Businesses Expanding Product Portfolio in High-Growth, Global Security Market
Transaction Adds Complementary Technology and Products, Creating a Comprehensive Security and Detection Portfolio
Leidos Holdings, Inc., a FORTUNE 500 science and technology leader, announced that it has entered into a definitive agreement to acquire L3Harris Technologies’ Security Detection and Automation businesses, for $1 billion in cash. The Boards of Directors of both companies unanimously approved the transaction.
L3Harris’ Security Detection and Automation businesses provide airport and critical infrastructure screening products, automated tray return systems and other industrial automation products. With headquarters in Tewksbury, Mass. and Luton, England, the combined businesses have 1,200 employees and a global sales and services operations footprint with more than 20,000 systems deployed world-wide across more than 100 countries. The businesses serve customers in the aviation, transportation, government and critical infrastructure markets.
“The acquisition of these businesses will help accelerate our growth and innovation and enable us to offer the market a comprehensive security platform,” said Leidos Chairman and CEO Roger Krone. “The businesses further our commitment to a diversified revenue stream, by expanding our customer penetration into 75 additional countries. This transaction is projected to be immediately accretive to revenue growth, EBITDA margins, and non-GAAP EPS upon closing.”
Krone continued, “This powerful portfolio of technology and the outstanding team of employees that support it complement the Leidos team well. The work this team performs is vital to securing so many important locations – where passengers count on equipment reliability and efficiency to keep them safe. This mission is consistent with our company’s goal of making the world safer, healthier and more efficient. Together, we will advance our strategy of helping secure some of the world’s most critical infrastructure and the individuals who travel through it. I look forward to welcoming these L3Harris employees to Leidos and working together to continue our important work.”
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Compelling Strategic and Operational Benefits
- Expands Product Portfolio in High-Growth, Global Security Market: This acquisition adds complementary products that expand Leidos’ offerings to create a comprehensive security and detection platform. These products include checkpoint security products like checkpoint CT scanners, people scanners, comprehensive explosives trace detectors, checked baggage screeners and automated tray return systems (ATRS). The addition of this technology to the Leidos portfolio will enhance the company’s offerings in a global security product market projected to grow in excess of the federal budget.
- Diversifies Revenue Through Increased International Presence: This business expands our customer penetration internationally, helping deliver on a stated objective to diversify revenue globally. The deal will increase Leidos’ international security products revenue more than six-fold.
- Enhanced Scale Accelerates Growth & Innovation: The acquisition enables Leidos to complement its existing successful global border and port sales channel by leveraging the acquired businesses’ global airport sales channel across the full Leidos portfolio of product and service solutions. The acquisition also enables the company to leverage technology investments across the combined portfolio to accelerate innovation and improve service efficiency for customers.