Celeritek's defense electronics business designs and manufactures gallium arsenide-based RF and microwave components and subassemblies for electronic warfare, radar and other military applications. Teledyne entered into an agreement with Celeritek, effective upon completion of the transaction, for the continued supply of GaAs semiconductor components for use in defense microwave products. In addition, following the transaction, Teledyne currently intends to relocate the business from Santa Clara, CA and consolidate it with Teledyne Microwave in Mountain View, CA.

"Celeritek's defense electronics division is an excellent strategic fit with both our Teledyne Microwave and Teledyne MEC Vacuum Electronics business units," said Robert Mehrabian, chairman, president, and CEO of Teledyne. "Celeritek is one of the defense industry's largest suppliers of specialized amplifier products. Celeritek's solid state amplifiers and complex microwave subassemblies utilize design and manufacturing technology similar to our existing Teledyne Microwave business and are complementary with Teledyne's line of high power helix traveling wave tubes used on military, electronic warfare, radar and communication applications.

"This acquisition would allow us to offer our defense customers a broader portfolio of microwave products and capabilities. In addition, we expect to obtain significant synergies through the consolidation of Celeritek's defense business with our current military microwave subassembly operations in Mountain View, CA."

"The divestiture of our defense electronics subsystems business will allow us to focus on designing and manufacturing high performance GaAs semiconductor components," said Tamer Husseini, chairman, president, and CEO of Celeritek. "The transaction will also provide us with substantial financial resources and an important new customer for our semiconductor operations."

Celeritek's defense electronics division had sales of $19.7 million for its fiscal year ended March 31, 2004. Teledyne Technologies expects the acquisition of Celeritek's defense electronics division to be neutral to earnings in 2004. If completed, the acquired business would be operated as part of Teledyne Microwave.

The transaction is subject to the approval of Celeritek's shareholders, as well as other customary closing conditions. All of Celeritek's directors and their affiliated investment funds that hold Celeritek shares, including SACC Partners LP, who collectively hold or control the vote of approximately 1.2 million shares (approximately 9.3% of outstanding shares) of Celeritek stock, have entered into voting agreements with Teledyne under which they have agreed to vote in favor of the transaction.

Warning: main(/client/home/frequency/docs/news/footer.inc) [function.main]: failed to open stream: No such file or directory in /data/1/0/29/140/29955/user/29528/htdocs/news/2004/Jul/defenseAssets.php on line 24

Warning: main() [function.include]: Failed opening '/client/home/frequency/docs/news/footer.inc' for inclusion (include_path='.:/usr/services/vux/lib/php') in /data/1/0/29/140/29955/user/29528/htdocs/news/2004/Jul/defenseAssets.php on line 24