Northrop Grumman Corporation · NYSE:NOC
Northrop Grumman — Merger or Acquisition (September 2017)
14 slides from Northrop Grumman's merger presentation, Sep 18, 2017
Slide 1: Northrop Grumman Acquisition of Orbital ATK
Northrop Grumman CorporationAcquisition of Orbital ATK September 18, 2017 Webcast
Slide 2: Forward Looking Statements
Forward Looking Statements This communication may contain statements, other than statements of historical fact that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expect,” “intend,” “may,” “could,” “plan,” “project,”
Slide 3: Northrop Grumman to Acquire Orbital ATK
Northrop Grumman to Acquire Orbital ATK Complementary portfolio and skills enhance Northrop Grumman’s strategic capabilities and growth opportunitiesSignificant benefits to customer driven by accelerated innovation, new capabilities and enhanced competitionCompatible culture and shared valuesSignifi
Slide 4: Orbital ATK – Highly Additive & Attractive Business
Orbital ATK – Highly Additive & Attractive Business Leading technologies and complementary capabilitiesAttractive portfolio of programs with minimal overlapStrong customer relationshipsIncreases international opportunitiesTechnically skilled employee population and compatible cultureHighly regarded
Slide 5: Transaction Highlights
Transaction Highlights 5 Transaction Northrop Grumman to acquire Orbital ATK for $134.50 per share in cashImplied equity value of ~$7.8B and enterprise value of ~$9.2B Financing Committed financing in placeInitial pro forma leverage of ~3.1x net debt to adjusted EBITDACommitment to strong investment
Slide 6: Orbital ATK
Orbital ATK 6 Created through 2015 merger of Orbital Sciences Corporation and ATK Aerospace and Defense~13,000 employees, including ~4,200 engineers and scientists$15.4B in total contract backlog2017 Financial GuidanceRevenue: $4.60 to $4.65 billion Operating Margin: 11.5% to 12.0%Free Cash Flow: $2
Slide 7: Selected Capabilities and Key Growth Areas
Selected Capabilities Key Growth Areas Flight Systems(35%) Revenue ~$1.6BLaunch VehiclesPropulsion SystemsAerospace Structures Engineering and integration of high-reliability launch systemsMedium / large solid rocket motorsComposite manufacturing for demanding applications Defense Systems (40%) Reve
Slide 8: Benefits to Orbital ATK – Enhanced Technologies and Capabilities
Benefits to Orbital ATK – Enhanced Technologies and Capabilities Greater access to and coordination of investment resourcesIncreased competitiveness in select mission areasEnhanced ability to meet customer needsReach-back capabilities from current Northrop Grumman sectorsRetention of merchant suppli
Slide 9: Complementary Core Capabilities
Complementary Core Capabilities Key Capabilities Northrop Grumman2017E Sales: Low $25B Orbital ATK2017E Sales: $4.60B to $4.65B Aircraft ü Large Space Systems ü Small Space Systems ü Launch Vehicles & Propulsion ü Missiles & Munitions ü Radars, Sensors & Processing ü Cyber Systems ü Large Scale Logi
Slide 10: Significant Shareholder Value Creation Opportunities
Significant Shareholder Value Creation Opportunities 10 Revenue Synergies New business opportunitiesMissile and missile defenseSpaceRestricted Cost Savings Estimated to achieve $150M run rate by 2020Corporate and back-office integrationFacility optimizationOrganizational alignment Operating Synergie
Slide 11: Capital Deployment Priorities
Capital Deployment Priorities Northrop Grumman will continue to invest for profitable growthContinued robust Cap Ex and IRADCapital StructureCommitted to solid investment grade credit ratingStrong cash flow generation supports near-term focus on debt reductionShareholdersCommitted to dividend payout
Slide 12: Key Takeaways
Key Takeaways Orbital ATK represents a strategic acquisition that benefits all key stakeholdersEnhances capabilities and growth potential in multiple marketsMeaningful value creation opportunity driven by strategic fit and synergiesStrong, complementary and diverse capabilities provide near- and lon
Slide 13: Additional Information and Where to Find It
Additional Information and Where to Find It This communication may be deemed to be solicitation material in respect of the proposed acquisition of Orbital ATK by the Company. In connection with the proposed acquisition, Orbital ATK intends to file relevant materials with the SEC, including a proxy s
Slide 14: The Value of Performance. Northrop Grumman
THE VALUE OF PERFORMANCE. NORTHROP GRUMMAN
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