By Robb M. Stewart
Comtech Telecommunications’ shares were heading for a strong open after the technology company agreed to sell its power systems technology product line to a portfolio company of private-equity firm Arlington Capital Partners for as much as $40 million.
In premarket trading, the shares were 17% higher after ending Thursday at $8.14, down 33% so far this year.
Under a definitive deal, Stellant Systems will buy Comtech’s product line for a preliminary $35 million, plus a contingent consideration of $5 million based on achieving certain targets. The exit is expected to be completed by the end of the month.
Comtech on Thursday forecast a between 1% and 4% sequential rise in sales for its fiscal first quarter after a 17% jump in sales in the three months to July 31 from a year earlier to $148.8 million. The company’s net loss narrowed for the fourth quarter to 19 cents a share from a loss of 26 cents last year.
Write to Robb M. Stewart at [email protected]
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