Why Viasat Stock Is Rocketing Higher Today
Satellite communications company Viasat (NASDAQ: VSAT) has agreed to sell a large portion of its military business to L3Harris Technologies (NYSE: LHX) for nearly $2 billion. Investors are excited by the deal, sending shares of Viasat up as much as 48%.
Viasat provides satellite and broadband services to a range of government, commercial, and consumer markets, including providing the in-flight Wi-Fi on Southwest Airlines flights. The company last year signed a deal to acquire Inmarsat Group Holdings for $6 billion, a deal that would expand its business but requires Viasat to come up with a lot of cash or take on significant debt.
On Monday, Viasat announced a deal that would help it raise a significant portion of the cash required, while also streamlining its business. Defense contractor L3Harris has agreed to buy Viasat's Link 16 Tactical Data Links business for $1.96 billion, a deal that would reduce Viasat's pro forma net leverage from 4.2 times adjusted EBITDA to 1.4 times adjusted EBITDA.
Source Fool.com
