Herley Industries Inc. announced that it has sold its Innovative Concepts (ICI) subsidiary located in McLean, VA to Elbit Systems of America LLC, which is a wholly owned subsidiary of Elbit Systems Ltd., of Haifa, Israel, in a $15 M all cash transaction.
Elbit Systems of America is a provider of high performance products and system solutions, focusing on the defense, homeland security, commercial aviation and medical instrumentation markets. With facilities throughout the United States, Elbit Systems of America is dedicated to supporting those who contribute daily to the safety and security of the United States.
Innovative Concepts is a communications technology development firm specializing in the research, design, development, production and support of wireless data communications products and services. Myron Levy, Herley's chairman and CEO, noted, "While ICI is an excellent company, it is a better fit for Elbit, than for Herley, which is primarily a hardware company. Herley does have requirements for software development, but we believe that those requirements can be met through our other businesses. With the sale of ICI and the recently announced acquisition of Eyal Microwave by Herley's subsidiary, General Microwave Israel Corp. (GMIC), we are building on the core strengths of the company and following our strategic plan to become the premier microwave supplier worldwide."
Levy continued, "ICI is a leading software developer of communication networking solutions, principally for the US Army. By buying Eyal and selling ICI, we are redeploying the company's financial assets to strengthen the company. We have shifted many of the product lines from our Herley Farmingdale operation to Israel, and we are continuing our emphasis on international business. GMIC has historically been one of our most profitable divisions. With the acquisition of Eyal, it could be the company's largest operation in terms of revenues and profits. With the integration of Eyal into GMIC we expect to see cost reductions and increased sales, which should drive the profit margins even higher."
