Sunnyvale, CA-based California Microwave Inc. has sold its government businesses to Northrup Grumman (Los Angeles, CA) for approximately $98 million cash. Under the agreement, Northrup will purchase California Microwave's Information Systems Division (ISD) and Government Electronics segment. Northrup Grumman will operate these units as the California Microwave element of its Electronic Sensors and Systems Sector (ES³).
Based Baltimore, MD, ISD develops airborne reconnaissance and surveillance systems, government ground-based satellite communications systems, and mission planning systems. The Government Electronics segment, located in Woodland Hills, CA, produces products for military services and other US Government agencies,
Under terms of the agreement, California Microwave will receive $93 million at closing and an additional $5 million in 2000 if certain revenue goals are met. It is expected that California Microwave will recognize a net gain of $38 million on this divestiture and anticipates netting greater than $80 million in cash after tax and other closing-related costs.
California Microwave also agreed to include its name as part of the sales agreement with Northrop Grumman. With its remaining businesses focused on wireless broadband solutions, California Microwave will become known as Adaptive Broadband Corp., featuring a new stock symbol of ADAP listed April 30, 1999 on the Nasdaq National Market trading system.
Adaptive Broadband Corp. will focus on wireless broadband access, point-to-multipoint solutions, broadcast TV products, broadband IP transport via satellite systems, and wireless online transaction processing.