Elbit Systems Limited, an Israel-based defense electronics company, has reportedly completed acquiring IMI Systems for $495 million. The acquisition also includes additional payment worth $27 million depending upon performance goals agreed during IMI meetings.
Sources reported that the acquisition of government-owned IMI Systems, which was formerly known as Israel Military Industries, entailed a prolonged tender privatization process that consumed 17 years of crises and negotiations.
Bezhalel Machlis, President and CEO of Elbit Systems, was quoted saying that the collaboration between the abilities of the two companies paired with Elbit Systems’ global position will allow the company to offer an improved portfolio and to identify the potential of the technologies possessed by IMI in the International arena, thereby making this a significant acquisition for the company’s long-term growth strategy.
Machlis further mentioned that Elbit Systems possesses a proven track record of major acquisitions that are successfully performing, and the acquisition of IMI Systems will be beneficial to Israel’s economy as well as the companies’ employees, customers, and shareholders.
A news report by the HAARETZ stated that the Israeli government’s intentions to privatize IMI, a manufacturer of military systems renowned for being an early manufacturer of the Uzi submachine gun, were first announced in 2013. Elbit Systems was the last bidder standing among the five interested in the company, the report mentions. Uzi Adam, Director General of the Defense Ministry, stated that Elbit being an Israeli company ensured that its sensitive defense information would stay within the country while enhancing its defense exports.
According to sources familiar with the development, out of the total sum Elbit is paying for IMI, only 500 million is estimated to go into state coffers, while the remaining amount will be directed towards IMI’s obligations.
Incidentally, it was a week after Avigdor Lieberman’s resignation as defense minister that the deal was carried out since he was hesitant to approve the deal claiming security consideration, cite sources.