Aerospace parts manufacturer Hi-Shear Technology Corp. is here to stay in Torrance and is even hiring despite its recent acquisition by a British defense contractor.
The company, which makes components for rockets and satellites, signed a definitive merger agreement in September with Chemring Group PLC, a London firm that makes munitions and pyrotechnics for the defense industry.
The $132 million acquisition was completed Nov. 24 and Chemring officials said they intend not only to keep Hi-Shear in its 76,000-square-foot location, but grow its operations.
“Hi-Shear’s location in L.A. is critical in that it is very close to the major U.S. missile and space contractors which form its main customers,” said Rik Armitage, Chemring Group’s business development director.
“This should create exciting new opportunities for the company and its 86 employees. As an international company, we have access to markets which Hi-Shear has no footprint in at the moment. And we are also prepared to invest significant amounts in our acquired businesses,” he said.
Hi-Shear had sales last fiscal year of $25 million compared with $583 million for Chemring.
Linda Nespole, Hi-Shear’s corporate secretary and director of human resources, said the company has already hired nine new people and is looking to expand its machine shop operations.
“This merger agreement is a great thing for us, and Chemring has said it will be shifting some its other business from its other operations over here,” Nespole said.
Hi-Shear’s component products are used in space satellites and launch vehicles for NASA, the Department of Defense and other government programs. It gets the majority of its revenues from sales to Lockheed Martin, Boeing Corp. and U.S. government contracts.
As part of the merger agreement, Hi-Shear shareholders will receive $19.18 per share, a 61 percent premium over the company’s stock price before the deal was announced.
David Buxton, London-based director of independent broker FinnCap, said the deal was in line with Chemring’s desire to better serve the U.S. defense market and government, which partner often with the U.K. as allies on military and humanitarian missions.
“Chemring has a good track record of owning other U.S.-based operations and has generally grown them through investment,” said Buxton, referring to expanding operations at Kilgore Flares in Toone, Tenn., and Alloy Surfaces Co. Inc. in Chester Township, Pa. “Already Chemring’s largest single customer base is the U.S. Department of Defense, so it is therefore an established business already in the USA.”
Get a Vestalife
Vestalife, a Studio City designer and manufacturer of iPod docking speakers, has fast become a darling of the consumer electronics industry since its products debuted two years ago.
The company’s speaker docks, coined the Ladybug for a design reminiscent of the insect, earned Vestalife its second consecutive “Best of Show” title at Macworld earlier this year.
That was followed by a surprise win at the Fashion Group International’s Rising Star Awards in the home and design category; it was the first electronics company ever to be nominated and win in the category.
“Music is important to people and consumers want a sensory-based experience from good sound quality to a cute yet sleek design for their speakers,” said Vestalife founder and President Wayne Ludlum. “So that’s why we have designed these products for the iPod and iPhone, to fill that niche.”
Vestalife’s 10 employees design the speakers locally, but they are built in China. The company’s flagship product is the Ladybug, which comes in red and silver, has flip-down speaker “wings” with a subwoofer, and can run on battery or AC power. It is sold through major retailers such as Target, Costco and Amazon.com for about $99.
For the holiday season, the company is introducing three speaker dock models, also with insect-themed names, the Firefly, Mantis and Ladybug II. They will be sold for the first time in Apple stores, retailing for $99 to$179.
Vestalife plans to launch earphone products next year, said Ludlum, who expects company sales for 2009 to be double that of 2008. He declined to name the amount.
Off to War
Tetra Tech Inc. has been awarded a $63 million contract to provide architect and engineering services for the U.S. Agency for International Development’s sustainable infrastructure development programs in Afghanistan.
“At this critical time in America’s involvement with Afghanistan, Tetra Tech is pleased to support USAID’s mission in the country,” said Chief Executive Dan Batrack in a statement.
Last week, President Obama recommitted to rebuilding Afghanistan through the type of infrastructure projects in which Tetra Tech specializes.
Working with the aid agency’s Office of Infrastructure, Engineering, and Energy, Tetra Tech will plan, design and provide engineering support for urban and rural water-supply and sanitation systems, schools and government facilities, transportation systems and other projects.
The five-year program is Tetra Tech’s first major award under a USAID global infrastructure services contract announced in October 2008, with a ceiling of $500 million.
Staff reporter Francisco Vara-Orta can be reached at firstname.lastname@example.org or (323) 549-5225, ext. 241.
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