Cubic to sell its Cubic Global Defense Services business to Valiant for $135M
Cubic announced that it has entered into a definitive agreement to sell its Cubic Global Defense, or CGD, Services business to Valiant Integrated Services for $135M cash at close on a debt free, cash free basis, plus $3M of contingent consideration tied to certain contract wins expected over the next 12 to 24 months. On March 31, the assets and liabilities of CGD Services will be considered held for sale and will be held at the lower of their carrying value or their fair value less estimated cost to sell. In Cubic's Q2 results, the CGD Services business will be reflected as discontinued operations and the previous period financial results will be reclassified for comparative purposes. Cubic expects to record a non-cash charge of approximately $7M within discontinued operations in Q2, based on the estimated excess of the carrying value of CGD Services over the consideration to be received. Upon the close of sale, the non-cash charge will be adjusted based upon a final analysis of the carrying amount of the assets and liabilities at the date of the sale, including the assessment of deferred tax assets and liabilities of discontinued operations. The transaction is anticipated to be completed within 30 to 60 days, subject to customary closing conditions and regulatory approvals.