Boeing (BA) is beefing up its defense, space and security operating unit with plans to acquire Argon ST (STST) in a $775 million, all-cash deal, at the aircraft maker announced Wednesday.
Under the deal, Boeing will pay $34.50 per share for Argon, representing a 41% premium over its closing price Tuesday and in excess of its 52-week high of $27.86. Apparently, Boeing knows what it's getting for its money, given that the industry titan and Argon have been partners for two years.
Argon develops sensors and networks designed to detect and analyze everything from radio frequency energy to underwater sounds and deliver that information in real-time to military troops engaged in war or first responders handling emergencies.
"Combining the strength of Boeing with the experience of Argon ST will significantly accelerate our capabilities in sensors, communications technologies and information management," said Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security, in a statement.
Argon will operate as a stand-alone subsidiary of Boeing's Network & Space Systems, which is housed under the Defense, Space & Security operating unit, which generates $34 billion in revenues. Argon last year brought in $366 million in sales.
Boeing plans to use its existing cash to pay for Argon and the deal is expected to close by the end of the third quarter.
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