SAN DIEGO, 17 Dec. 2014. Cubic Corp. (NYSE:CUB) has acquired DTECH LABS Inc. (DTECH), a 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 million to $200 million C4ISR (command, control, communications, computers, intelligence, surveillance, and reconnaissance) business generating mid-teen EBITDA (earnings before interest, tax, depreciation and amortization) margins. DTECH represents a value investment and adds networking capability to our secure communications business,” explains 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 believe this is a great strategic and cultural fit with the continued opportunity to innovate for our combined customers,” says Bob Denson, president of DTECH.
The transaction is expected to be accretive to earnings beginning in fiscal year 2016.
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.