SAFRAN Acquires Majority Stake in GE Homeland Protection, Bolstering Ties With General Electric
24 April 2009 - 8:27AM
PR Newswire (US)
PARIS, April 24 /PRNewswire-FirstCall/ -- SAFRAN announced today
that it has acquired 81% of GE Homeland Protection, a wholly owned
affiliate of the General Electric Company (NYSE:GE). GE Homeland
Protection is a leader in tomography-based detection systems for
hazardous or illicit substances in baggage. Through this
acquisition Sagem Sécurité, a wholly owned subsidiary of SAFRAN
becomes a leading global player in airport security solutions.
SAFRAN is carrying out this acquisition in partnership with General
Electric, which retains a 19% stake in the company and a seat on
the Board of Directors. Through this new partnership, the Homeland
Protection business will continue to benefit from the advanced
technologies developed by GE Healthcare and from the expertise of
the GE research center. SAFRAN is acquiring an 81% stake in GE
Homeland Protection for US$580 million. Homeland Protection
provides equipment and services to protect airports, ports, borders
and critical infrastructures, for Government, military and
commercial customers. It is a leader in tomography-based technology
for detection of hazardous or illicit substances in checked
baggage, with the largest worldwide installed base of approximately
1,600 machines. The business also provides services for its
installed base, which generate approximately 60% of total revenues.
Homeland Protection's latest product, the CTX 9800, certified by
the Transportation Security Administration (TSA) in March 2009,
offers the highest resolution and the highest throughput system in
the industry. Homeland Protection is also a leading provider of
Trace equipment. GE Homeland Protection has approximately 780
employees, including 150 in Research & Development, located in
the U.S., Europe and Asia, and posted sales of about US$260 million
in 2008. It has posted sales in 2009 in line with growth objectives
for the year. By acquiring GE Homeland Protection, SAFRAN also
acquires leading-edge technology to support its development in an
industry characterized by: - Recurring revenue generated by service
of the installed base. - Growth: the explosives and narcotics
detection market, today estimated at approximately US$2.4 billion,
is headed for strong short and medium-term growth. The U.S.
stimulus package includes a budget of approximately US$700 million
for checked baggage infrastructure and equipment, while new
regulations in Europe require Standard 3 (tomography-like)
detection equipment to be purchased from 2012 with complete
replacement to Standard 3 equipment by 2018. Combining Homeland
Protection's detection capabilities with Sagem Sécurité's (SAFRAN
Group) identity solutions will enable SAFRAN to provide a
differentiated, seamless and integrated offering to customers.
Jean-Paul Herteman, CEO of SAFRAN, said: "Following our 2008
acquisitions of SDU-Identification (a Dutch manufacturer of secure
passports and ID documents) and Motorola's biometrics business
(Printrak brand), adding GE Homeland Protection will significantly
bolster our Group's third core business. This makes SAFRAN a
pivotal player in the security market, a business that will
generate 20% of the Group's total revenues in the medium term, with
double-digit profit perspectives and reducing exposure to aerospace
cycles. Furthermore, this transaction is the latest step in our
long-standing relationship of mutual trust and partnership with GE
that reaches back some 35 years." Jean-Paul Jainsky, Chairman and
CEO of Sagem Sécurité, added: "There is growing demand from both
governments and private industry for cutting-edge security
solutions, based on long-term projects anchored in advanced,
very-high-reliability technologies. From this standpoint, the
SAFRAN Group is in a perfect position to meet today's most
demanding public security requirements." Dennis Cooke, President
and CEO of GE Homeland Protection said: "This is a great move for
our Homeland Protection business. Our business has a strong
leadership team, dedicated and talented employees, innovative
technology, a large installed base and a strong brand. This move
aligns Homeland Protection with a business that is committed to
globalization and further investment in new detection technologies
and new products for the Homeland Security space." The transaction
is expected to be finalized by mid 2009, pending customary
regulatory approvals. SAFRAN is an international high-technology
group with leadership positions in its core businesses of aerospace
propulsion, aircraft equipment, and defense security. The SAFRAN
Group employs about 54,000 people in over 30 countries and
generates revenue of more than EUR10 billion. It comprises many
companies with prestigious brand names and holds, alone or in
partnership, global or European leadership positions in its
markets. SAFRAN is listed on NYSE Euronext Paris and its share is
included in the SBF 120 and Euronext 100 indices. For more
information: http://www.safran-group.com/ Sagem Sécurité (SAFRAN
Group) is a high-technology company. One of the world's leading
suppliers of identity solutions, Sagem Sécurité focuses on
applications including personal rights and flow management, in
particular based on biometrics, a sector in which it is the world
leader, secure terminals and smart cards. Its integrated systems
and equipment are deployed worldwide and contribute to the safety
and security of transportation, data, people and states. Sagem
Sécurité has 4,300 employees in over 24 countries in 2008. For more
information, http://www.sagem-securite.com/ GE Security, Inc. is a
wholly owned affiliate of the General Electric Company (NYSE:GE)
focused on communication and information technologies for security
and life safety solutions. GE Security has more than 5700 employees
with operations in over 26 countries and is represented by some of
the best-known brand names for intrusion and fire detection, access
and building control, video surveillance, explosives and drug
detection, key management and structured wiring. GE Homeland
Protection, Inc. is focused on explosives and narcotics detection
and has approximately 780 employees worldwide. For more
information: http://www.gesecuriry.com/ Caution Concerning
Forward-Looking Statements This document contains "forward-looking
statements" - that is, statements related to future, not past,
events. In this context, forward-looking statements often address
our expected future business and financial performance, and often
contain words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," or "will." Forward-looking statements by their
nature address matters that are, to different degrees, uncertain.
For us, particular uncertainties which could adversely or
positively affect our future results include: the behavior of
financial markets, including fluctuations in interest rates and
commodity prices; strategic actions, including dispositions; future
integration of acquired businesses; future financial performance of
major industries which we serve, including, without limitation, the
air and rail transportation, energy generation, media, real estate
and healthcare industries; unanticipated loss development in our
insurance businesses; and numerous other matters of national,
regional and global scale, including those of a political,
economic, business, competitive and regulatory nature. These
uncertainties may cause our actual future results to be materially
different than those expressed in our forward-looking statements.
We do not undertake to update our forward-looking statements.
DATASOURCE: SAFRAN CONTACT: Investors and Analysts contact: Quy
Nguyen-Ngoc, Director, Investor Relations and Financial
Communication, Tel +33(0)1-40-60-80-45, Fax +33(0)1-40-60-84-36, ;
Press Contact : Catherine Malek, Press Relations Manager, Tél
+33(0)1-40-60-80-28, Fax +33(0)1-40-60-80-26, . SAFRAN Group, 2, bd
du Général Martial Valin, 75724 Paris Cedex 15 - France.
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