Melbourne-based aerospace and defense technology L3Harris Technologies Inc. (NYSE: LHX) on July 29 acquired El Segundo, California-based missile and rocket maker Aerojet Rocketdyne Holdings Inc. for $4.7 billion. The company generates about $2.2 billion in annual revenue.
L3Harris is Central Florida's largest technology employer, with 8,500-plus local workers. As a result of the acquisition, 5,000 employees were added to the L3Harris team, though they have stayed in the same locations throughout the U.S. where they were prior to the acquisition.
Acquiring Aerojet has helped L3Harris expand its aerospace and defense industrial base and scientific innovation in advanced missile technologies, hypersonics and other Aerojet technologies for customers such as NASA and the Department of Defense.
Why L3Harris could acquire Aerojet Rocketdyne while Lockheed Martin couldn’t
Only three years ago, defense contractor Lockheed Martin Corp. (NYSE: LMT) said it would buy Aerojet for $4.4 billion. Lockheed abandoned the deal when the Federal Trade Commission sued to block the sale in January 2022, claiming the acquisition would give Lockheed an unfair ability to deny other defense contractors access to Aerojet components needed to build competing missiles.
Those systems were primarily high-speed divert and attitude control systems that allow missiles to steer toward and intercept other high-speed missiles. Lockheed was one of Aerojet’s primary customers for interceptor rocket divert technology, but not the only one. L3Harris doesn’t build interceptor rockets.
Read on for more big deals:
Unmanned aircraft manufacturer buys Melbourne robotics firm
On Sept. 18, Arlington, Virginia-based AeroVironment Inc. (Nasdaq: AVAV) acquired Tomahawk Robotics of Melbourne, a tech firm that launched at Groundswell Startups, an entrepreneurial support organization.
- Parties involved: AeroVironment Inc.; Tomahawk Robotics
- Cost: $120 million
- Why it matters: Tomahawk — which makes AI-enabled robotic control systems for the military — was appealing to AeroVironment because integration will benefit unmanned systems through a singular platform with similar control features.
Wahid Nawabi, chairman, president and CEO, AeroVironment: “Now that the acquisition is finalized, we’re able to further integrate both companies’ technologies and accelerate our implementation of AI and autonomy into AeroVironment’s platforms."
Orlando-based fintech startup attracts publicly traded buyer
Alterna Capital Solutions LLC of Winter Park was acquired by Rochester, New York-based Paychex Inc. (Nasdaq: PAYX) in a move that expanded and diversified the Paychex portfolio of solutions and support serving small- to medium-sized businesses.
- Parties involved: Alterna Capital Solutions LLC; Paychex Inc.
- Cost: $94.8 million
- Why it matters: Paychex is best known for payroll services, and with this acquisition it adds financing to cover gaps in cash flow and populate inventory, plus other services for manufacturing, transportation, food and beverage, internet technology, telecommunications and startup businesses — areas where Alterna specializes.
Jay Chaudhari, executive director, 1858 Capital Partners: "Potential buyers observe how regions handle economic cycles like downturns. The way Florida handled Covid-19, the sustainable market we have, that was noticed."
Denny's buys Keke's and serves up new locations nationwide
On July 20, Spartanburg, South Carolina-based Denny’s (Nasdaq: DENN) acquired Keke’s Breakfast Café from Orlando-based K2 Restaurants Inc., buying up Keke’s franchise assets and liabilities along with eight restaurants owned and operated by the sellers.
- Parties involved: Denny’s; K2 Restaurants Inc.
- Cost: $82.5 million
- Why it matters: The acquisition puts Keke's in position to expand rapidly. A hundred franchise locations will open around the country in the near term, the first in Nashville, Tennessee.
Kelli Valade, CEO, Denny's: The “complementary concept serves a different guest [than Denny’s] and can enhance value for our shareholders."
Largest restaurant group acquires classy steakhouse chain
On June 14, Orlando’s Darden Restaurants (NYSE: DRI) — the nation’s largest restaurant company — acquired Ruth’s Hospitality Group. The news broke in a May 2 Securities and Exchange Commission filing and subsequent May 3 news release when Darden announced it would buy all outstanding shares of Ruth's Hospitality for $21.50 per share in an all-cash transaction.
- Parties involved: Darden Restaurants; Ruth’s Hospitality Group
- Cost: $715 million
- Why it matters: Ruth's CEO Cheryl Henry said the transaction will provide more opportunities for Ruth's team members to develop in their careers. There have been a few changes since the acquisition: a new Ruth's Chris restaurant in Albany, New York, and a move to a different Woodland Hills, California, spot for the steakhouse.
Rick Cardenas, CEO, Darden Restaurants: "Ruth's Chris is a strong and distinctive brand in the fine-dining segment with a history of providing elevated dining experiences to their loyal guests."
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