BAE Systems Plc agreed to buy the aerospace division of soda-can giant Ball Corp. for $5.6 billion, as the UK defense company seeks to expand its missile, space and munition products at a time of heightened weapons spending by governments.
The London-based defense giant entered into a definitive agreement to purchase the unit, which manufactures instruments and sensors for everything from space travel to weather forecasting, according to a regulatory filing on Thursday. Bloomberg News reported the companies were close to an agreement on Wednesday.
If completed, the transaction would mark the biggest purchase yet in the company’s history and give BAE a presence in the fast-growing space sector, from where it has been largely absent. Olivier Brochet, an analyst at Redburn Atlantic, said that while the price paid looks high, it reflects the long-term value that can be derived from the asset.
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