Acquisition strengthens Cubic’s secure communications business and networking capabilities
SAN DIEGO, Calif. – Dec. 16, 2014 – Cubic Corporation (NYSE: CUB) today announced the acquisition of DTECH LABS, Inc. (DTECH), a leading provider of modular networking and baseband communications equipment based in Sterling, Va., for up to $114.5 million, including $15 million of contingent consideration and subject to the terms of the stock purchase agreement.
“DTECH is the first step in our near-term strategy to build a niche $100-200 million C4ISR business generating mid-teen EBITDA margins. DTECH represents a value investment and adds networking capability to our secure communications business,” said Bradley H. Feldmann, president and chief executive officer of Cubic Corporation. “We welcome the DTECH team to Cubic and look forward to working with them to leverage our combined capabilities, talent, technology, innovation and outstanding customer relationships.”
DTECH’s ruggedized communications portfolio includes tactical and strategic networking products for portable, man-packable, vehicular and airborne applications. DTECH is an established supplier for Special Operations Command (SOCOM), the U.S. Marine Corps, and other government and commercial customers. Cubic anticipates this acquisition will result in significant growth opportunities.
“We look forward to being part of the Cubic family and continuing to grow and serve our important customers,” said Bob Denson, president of DTECH. “We believe this is a great strategic and cultural fit with the continued opportunity to innovate for our combined customers.”
The transaction is expected to be accretive to earnings beginning in fiscal year 2016.
About Cubic Corporation
Cubic Corporation is the parent company of three major business segments. Cubic Transportation Systems is a leading integrator of payment and information technology and services for intelligent travel solutions. Cubic Defense Systems is a leading provider of realistic combat training systems and secure communications. Mission Support Services is a leading provider of training, operations, maintenance, technical and other support services for the U.S. and allied nations. For more information about Cubic, see the company's Web site at www.cubic.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to the safe harbor created by such Act. Forward-looking statements include, among others, statements about the anticipated cost of the acquisition, Cubic’s long-term growth strategy, the likelihood that the acquisition will result in significant growth opportunities, and expectations regarding the acquisition being accretive to earnings. These statements are often, but not always, made through the use of words or phrases such as “may,” “will,” “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “predict,” “potential,” “opportunity” and similar words or phrases or the negatives of these words or phrases. These statements involve risks, estimates, assumptions and uncertainties that could cause actual results to differ materially from those expressed in these statements, including, among others: Cubic’s ability to successfully integrate new companies into its business and to properly assess the effects of such integration on its financial condition; competition and technology changes in the industries in which Cubic does business; and Cubic’s ability to successfully develop, introduce and sell new products, systems and services in current and future markets. In addition, please refer to the risk factors contained in Cubic’s SEC filings available at www.sec.gov, including Cubic’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Because the risks, estimates, assumptions and uncertainties referred to above could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements, you should not place undue reliance on any forward- looking statements. Any forward-looking statement speaks only as of the date hereof, and, except as required by law, Cubic undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date hereof.
Media contact:
Suzanne Hatcher
Director of Corporate Communications
Cubic Corporation
858-505-2430
suzanne.hatcher@cubic.com
Investor contact:
Diane Dyer
Director of Investor Relations
Cubic Corporation
858-505-2907
diane.dyer@cubic.com