Elbit Systems of America, a subsidiary of Elbit Systems and the Harris Corporation have agreed to move forward with the acquisition of Harris’ Night Vision business for $350 million. The acquisition of Harris’ night vision business opens a huge market for Elbit Systems, both domestic and international. Over 50 years Harris and its predecessors Exelis and ITT have established their night vision systems as the market leader. But with the planned merger between Harris and L3 Technologies, Inc., the night vision systems business becomes redundant under the combined portfolio.
Expected to be completed by mid-year the planned merger between Harris and L3 creates a defense electronics giant worth $33.5 billion, to be ranked sixth in the US market, after Lockheed Martin, Boeing, Raytheon, Northrop Grumman, and General Dynamics. Harris and L3 are both major suppliers of night systems to the US military and Government. One of the two competing lines had to go. With annual revenues around $150-160 million, and solid profit margins, Harris’ night vision portfolio is smaller than L3’s.
Continued operation support of both activities was a concern for the Justice Department’s, considering the merger approval. For Elbit Systems this was a great opportunity, elevating its position as a major supplier in the US market and opening a new marketing channel for its large product portfolio of complementary and innovative products. “In January 2019, we announced that as part of the L3 merger regulatory process we had proactively started exploring the sale of our Night Vision business,” said William M. Brown, chairman, president, and chief executive officer. “With the signing of the agreement to divest the Night Vision business and yesterday’s approval by shareholders of the L3 Harris merger, we have achieved two significant milestones towards completing the transformational merger in mid-calendar 2019.”
Harris has led the night vision industry for over 50 years. According to Harris, the company produced more night vision devices than all competitors combined. Harris Night Vision activity is a remnant of several acquisitions. The first, was in 2011, as Exelis was a spinoff from ITT Corporation, becoming an independent defense company, and in 2015, as Exelis was acquired by Harris.
Among the latest innovations Harris offers are AN/PSQ-20A enhanced night vision goggles, i-Aware Fusion lines, combining third generation night vision, thermal vision and integrated live video display on an advanced headset. Harris is the leading supplier of aviators night vision systems (ANVIS), used by the military. In 2018 the company’s light intensification tubes and ANVIS assembly (AN/AVS-9) was certified by the Federal Aviation Authority (FAA) for civilian use for night flying with fixed and rotary wing aircraft. Elbit Systems’ portfolio provides many complimentary activities, including thermal imaging, weapon sights, soldier systems, day and night helmet mounted aviator displays and pilot sights for combat helicopters. “The market position and technological strength of Harris Night Vision make this acquisition significant to our long-term growth strategy, with a particular focus on the U.S.” Bezhalel (Butzi) Machlis, Elbit Systems President & CEO commented.