In a bid to raise more capital for new deals, private equity firm Veritas Capital is planning to sell two high tech portfolio companies. It indicated that the total value coming from the sale is close to $3 billion.
The New York-based firm is expected to sell off electronic components manufacturer Excellitas Technologies and radar component manufacturer Anaren. The sale will turn out to be a boon for various M&A deals in the aerospace and defense related deals in the U.S. The sector has seen a tremendous decline in deals this year with nearly a 46% slide with only $1 billion worth of deals that have materialized.
To move the deal forward, Veritas signed with Goldman Sachs to initiate a dual track sale process of Excellitas. The Massachusetts based company will be sold outright or through an IPO. It is indicated that if the deal goes through, the transaction value will be $2 billion.
Veritas has several assets around national security and tech firms. Along similar lines, the private equity firm has hired a few bankers to cut a deal by selling Anaren. This is expected to be a separate deal, which could potentially fetch $800 million. However, no one from Veritas or Goldman Sachs was available to comment on this development.
Excellitas manufactures LEDs (Light Emitting Diodes) which are used in various fields like medical lighting and aerospace and defense equipment.
Anaren produces components for microwaves, particularly for wireless, space and defense electronics providers. The company’s customers include Raytheon, Lockheed Martin, and Northrop Grumman Group.
Sources indicate that Veritas tried to sell Excellitas in 2014 but the deal did not materialize as they did not reach an agreed figure.