US-based L3Harris Technologies has agreed to sell its airport security and automation business to Leidos in a cash deal valued at $1bn.
The sale of its Security & Detection Systems and MacDonald Humfrey Automation businesses is part of L3Harris’ strategy to focus on core technologies.
The businesses are said to have annual revenues of around $500m.
The solutions offered by these businesses are used by aviation and transportation industries, and regulatory and customs authorities.
Different government and law enforcement agencies and commercial and high-security facilities also use solutions offered by them.
Commenting on the acquisition, L3Harris chairman and CEO William M Brown said: “Today’s announcement represents a significant milestone in L3Harris’ strategic priority to reshape our portfolio following last year’s L3 and Harris merger.”
“The agreement provides a stable path forward for the Security & Detection Systems and MacDonald Humfrey Automation businesses, while enabling L3Harris to focus its resources on core technologies.”
The company intends to use the proceeds from the deal for shares repurchasing and offset dilution.
The deal is expected to be completed mid this year after meeting routine closing conditions, which includes the regulatory approvals.
Aerospace and defence technology innovator L3Harris was formed after the merger of equals of Harris Corporation and L3 Technologies last June.
With annual revenue of $18bn, it is said to be the sixth-largest US defence company, with 50,000 employees. The company has customers from 130 countries around the world.
Based in Virginia, Leidos serves the defence, intelligence, homeland security, civil, and health markets.
In October, Leidos secured a follow-on contract from the US Transportation Security Administration (TSA) to maintain equipment used to carry out checkpoint screening operations.