Harris Corporation has announced the spin-off of its subsidiary, the completion of a major acquisition, company-wide cost-reduction initiatives and the impairment of goodwill and other intangible assets in its Broadcast Communications segment.
The distribution of the approximately 56% of the outstanding shares of Harris Stratex Networks, owned by Harris, occurred on May 27, 2009.
The company estimated that the spin-off will result in a $60m to $70m after-tax charge in the fourth quarter of fiscal 2009, which will be reflected in discontinued operations in Harris’ financial statements and is related to the write-down of Harris Stratex net assets to the fair value of the Harris Stratex shares distributed to Harris shareholders and other spin-off related charges.
The company has announced the impairment of the current carrying value of its goodwill and other intangible assets related to its Broadcast Communications segment.
The company’s cost-reduction actions are expected to result in charges in the fourth quarter of fiscal 2009 that total $24m to $28m and are expected to result in annualised cost savings of approximately $70m to $75m.
Howard Lance, chairman, president and CEO of Harris, said: The combination of the wireless systems business with our RF communications business creates a powerful supplier in the growing $9 billion global land mobile radio systems market. This acquisition accelerates our entry into the federal, state and local public safety markets and creates an opportunity for new growth. The acquisition was completed ahead of schedule and integration activities are underway.”