DRS Technologies acquires Codem Systems

PARSIPPANY, N.J., 18 April 2005. DRS Technologies, Inc. announced today that it has acquired Codem Systems, Inc. in a stock purchase transaction valued at approximately $29 million in cash, with additional consideration payable upon achievement of certain financial targets.

PARSIPPANY, N.J., 18 April 2005. DRS Technologies, Inc. announced today that it has acquired Codem Systems, Inc. in a stock purchase transaction valued at approximately $29 million in cash, with additional consideration payable upon achievement of certain financial targets.

Established in 1972, Codem Systems is a privately-held business located in Merrimack, N.H. It is a provider of signals intelligence (SIGINT) systems, network interface modules, and high-performance antenna control systems. As a supplier of advanced technology products, Codem focuses on innovative solutions for communications and surveillance applications supporting the growing intelligence, military and homeland security markets. The company's expertise is concentrated in systems engineering software and hardware development as well as end-user training.

"Codem enhances DRS's position in intelligence and surveillance systems, while supporting greater access to emerging market opportunities, such as those related to homeland defense," said Mark S. Newman, chairman, president, and CEO of DRS Technologies. "With a large installed base of products, longstanding customer relationships and an established position in growing markets, Codem builds on the existing domestic and international defense and government agency customer base within our C4I Group."

Codem's signal intelligence systems intercept, monitor, and geographically locate radio and wireless signals. Its products, such as high-frequency (HF) SIGINT systems, are complementary to DRS's core intelligence systems business and are employed in communications intelligence (COMINT), electronic warfare (EW) and radio spectrum management.

Codem's antenna controllers and monitoring software are used in satellite communications (SATCOM), remote sensing, tracking, telemetry, command and control, broadband wireless systems and ground surveillance, as well as in military communications on-the-move (COTM) applications. Like DRS's intelligence and tactical systems, these product lines support Army ground force digital communications and direct broadcast satellite applications for ships and aircraft.

Codem's network access products contribute to the U.S. military's transformation to a network-centric warfare environment and provide interoperability between modern network technologies and legacy transmission networks.

In its first 12 months of operation under DRS ownership, Codem is expected to be accretive to earnings and generate approximately $25 million in annual revenues.
DRS financed the acquisition by utilizing existing cash on hand. BB&T Capital Markets/Windsor Group, a division of Scott & Stringfellow, Inc., served as financial advisor to Codem.

DRS Technologies, headquartered in Parsippany, N.J., provides leading edge products and services to defense, government intelligence and commercial customers. Focused on defense technology, DRS develops and manufactures a broad range of mission critical systems. The company employs 5,700 people worldwide. For more information, see www.drs.com.

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