According to a formal stock purchase agreement, BAE Systems plc has agreed to buy the Ball Aerospace division from Ball Corporation for about $5.55 billion in cash, subject to usual closing adjustments.
With an anticipated net present value tax benefit of around 750 million dollars, the planned stock transaction will be considered an asset purchase for federal tax purposes, making the underlying economic consideration over $4.8 billion for the company.[1]
“The proposed acquisition of Ball Aerospace is a unique opportunity to add a high quality, fast growing technology focused business with significant capabilities to our core business that is performing strongly and well positioned for sustained growth. It’s rare that a business of this quality, scale and complementary capabilities, with strong growth prospects and a close fit to our strategy, becomes available,” said Charles Woodburn, Chief Executive of BAE Systems.
Ball Aerospace is a market-leading manufacturer of satellites, mission payloads, optical systems, and antenna systems with a track record of success supported by cutting-edge technology of the highest caliber.
They enjoy dependable connections with the US Department of Defense, civilian space agencies, and the Intelligence Community.
The proposed acquisition offers a rare chance to bolster its portfolio with a sizeable scale and cutting-edge technological capabilities.
In the expanding space domain, C4ISR, missile, and munitions industries, Ball Aerospace will generate more than $2 billion in additional yearly revenues.
The acquisition will strengthen their US business’ alignment with the long-term customer priorities represented in the US National Military Strategy.
It will also provide us with a position in some of the military market’s fastest-growing categories.
The expansion of our footprint in space by order of magnitude, the provision of a complementary set of customer relationships in the national security space community, and new access to civil space markets are all part of the growth outlook, which is anticipated to grow at a rate of about 10% CAGR over the next five years. This will build on the strong portfolio of our US business.
Additionally, a wide range of products and distinctive technologies are supported by Ball’s expertise in spacecraft, mission payloads, optical systems, sensors, scientific and tactical systems, analytical tools, and world-class antenna systems to address the expanding markets for space, C4ISR, missiles, and munitions.
References
- BAE Systems, ‘BAE Systems plc – Proposed acquisition of Ball Aerospace’, 17 August 2023, https://www.baesystems.com/en/article/proposed-acquisition-of-ball-aerospace[↩]
