BAE acquires US armaments maker Armor Holdings

Our Corporate Bureau
01 August 2007

Defence firm BAE Systems, which is facing a probe by US authorities into whether its business dealings comply with anti-corruption laws, has concluded a $4.5-billion takeover of US military manufacturer Armor Holdings.

Though it has denied any wrongdoing in a 1980s arms deal with Saudi Arabia, it is being probed by the US justice department, which observers say could hurt the UK company badly.

BAE And Armor had originally announced a definitive agreement on 7 May, 2007, when BAE Systems offered $88 per share of outstanding Armor Holdings stock, along with the assumption of $388 million in debt, which valued the transaction at approximately $4.5 billion.

Armor Holdings reported 2006 sales of $2.3 billion and a before-tax profit of $214 million.

BAE makes the Challenger tanks for the British army, and the Armor acquisition could ultimately increase BAE's sales by $3 billion.