Elbit Systems of America Signs Definitive Agreement to Acquire Sparton Corporation

Elbit Systems Ltd. announced today that its U.S. subsidiary, Elbit Systems of America, LLC has signed a definitive agreement with an affiliate of Cerberus Capital Management, L.P. for the acquisition of Sparton Corporation for a purchase price of $380 million.

The transaction is conditioned on various closing conditions, including receipt of U.S. regulatory approvals, the pursuit of which could encompass a number of months.

Headquartered in De Leon Springs, Florida, Sparton is a premier developer, producer and supplier of electronic systems supporting Undersea Warfare for the U.S. Navy and allied military forces. Based in Fort Worth, Texas, Elbit Systems of America is a provider of high-performance products, system solutions, and support services to customers in the defense, homeland security, law enforcement, commercial aviation, and medical instrumentation markets.

“The acquisition of Sparton will strengthen Elbit Systems of America’s capabilities and will enable expansion of activities in the naval arena. We believe this acquisition will be beneficial for both Elbit Systems’ and Sparton’s employees and customers,” said Bezhalel (Butzi) Machlis, Elbit Systems President & CEO.

“In partnership with Cerberus, we have taken significant steps to strengthen our platform and expand our capabilities,” said Bill Toti, Chief Executive Officer of Sparton. “As we begin our next chapter of growth, we look forward to the strategic combination with Elbit Systems of America and leveraging our combined expertise to further elevate Sparton’s market-leading position. Together, we will be able to deepen our relationships and deliver innovative solutions to meet our customers’ needs.”

“We are proud of all that we have accomplished together with Sparton, including the transformative separation of its two business segments. Now, as a pure-play defense supplier, Sparton is well-positioned to build on its strong foundation and drive the platform’s long-term growth. We are pleased that Sparton has found a strategic partner in the next phase of its journey and wish Bill and the entire Sparton team continued success,” said Dev Kapadia, Senior Managing Director of Cerberus.

Cerberus acquired Sparton in 2019, and since that time, has partnered with the company to execute on several operational and strategic initiatives, including the recent separation of its defense products and contract manufacturing segments. The separation enabled each business, which operated in distinct industries with tailored strategies, to focus on its core strengths and respective opportunities. Following the divesture of the contract manufacturing segment, Sparton became a standalone, pure-play defense supplier, well-positioned to build on its track record of providing innovative products to the U.S. Navy, allied governments, and leading defense contractors.

Moelis & Company LLC and Evercore served as the financial advisors and Kirkland & Ellis LLP served as the legal advisor to Sparton. Covington & Burling LLP served as the legal advisor to Elbit Systems of America.



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