TRW and Northrop Grumman Are Getting Together

M&A in the third quarter started with a bang as TRW Corp. inked a definitive to be acquired by Northrop Grumman Corp. for $60 a share, or $7.8 billion, not including approximately $5 billion in debt. The biggest announced M&A situation of the first half of this year, Los Angeles-based Northrop first made a hostile stock offer for TRW, an automotive and defense systems company, in late February, for $47 a share, sweetening the bid in subsequent months. In a statement earlier today, Northrop said it would exchange one TRW share for 0.4348 and 0.5357 Northrop shares. Northrop also said it would look to divest TRW’s automotive division, which boasts annual revenue of more than $10 billion, after the consummation of the transaction. Northrop expects to close the deal by the fourth quarter.