NEWS RELEASE
AYDIN CORPORATION AGREES TO BE ACQUIRED
BY L-3 COMMUNICATIONS CORPORATION
Sale at 39% Premium to Current Market Will Cap Efforts to Enhance Shareholder
Value Undertaken in 3Q 1998 by The Full Value Committee
NEWTOWN, PENNSYLVANIA, March 1, 1999: Aydin Corporation (NYSE:AYD) announced
today that it has entered into a definitive merger agreement with L-3
Communications Corporation (NYSE:LLL) providing for the acquisition by L-3 of
all of the outstanding common shares of Aydin Corporation at $13.50 per share in
cash. The transaction was unanimously approved by Aydin's Board of Directors.
The sale of Aydin, at a price which represents a 39% premium to the Company's
closing market price on February 26, will culminate efforts undertaken last Fall
by The Full Value Committee, a group of Aydin Stockholders led by Warren
Lichtenstein, the Company's current Chairman. As previously announced in August
1998, the Company engaged PricewaterhouseCoopers Securities, LLC to assist the
Company in evaluating potential strategic alternatives to enhance shareholder
value.
The merger agreement with L-3 Communications provides for a wholly owned
subsidiary of L-3 to promptly commence a cash tender offer to acquire all of
Aydin's outstanding shares at $13.50 per share. The tender offer is conditioned
on, among other things, the valid tender of such number of shares which would
represent at least a majority of Aydin's outstanding shares on a fully diluted
basis and receipt of regulatory approvals. The tender offer is not subject to
financing and is expected to commence by Friday. Following completion of the
tender offer, L-3 will be entitled to designate a majority of the Board of
Directors of Aydin. The parties will complete a second-step cash merger at
$13.50 per share as promptly as practicable following completion of the tender
offer. The transaction has a total value of approximately $72.3 million,
including the cash-out of outstanding stock options and warrants.
Commenting on the execution of the merger agreement, Warren Lichtenstein,
Chairman of Aydin, stated: "Aydin Corporation has engaged in an extensive
process, with the assistance of PricewaterhouseCoopers Securities LLC, the
Company's financial advisor, in soliciting and evaluating third party interest
in a sale of the Company. We are convinced that the current $13.50 per share
offer by L-3 Communications is in the best interests of our shareholders."
Steel Partners II, LP, a limited partnership controlled by Mr. Lichtenstein, and
Sandera Partners, L.P., and Newcastle Partners, L.P.(which entities are
associated with other directors of Aydin Corporation), and certain of their
respective affiliates and associates, which beneficially own an
aggregate of approximately 12% of the outstanding Aydin shares, have agreed to
tender such shares provided that the acquisition agreement has not been
terminated. As of March 1, 1999, Aydin had approximately 5.2 million shares
outstanding.
A detailed discussion of the rationale for the Aydin Corporation Board of
Directors' recommendation will be contained in a Solicitation/Recommendation
Statement on Schedule 14D-9, which is expected to be filed with the Securities
and Exchange Commission early next week and will be mailed to shareholders
shortly thereafter.
Aydin Corp. is a world-class provider of products and systems for the
acquisition and distribution of information over electronic communications
media. The Company designs, engineers, manufactures, markets, distributes and
installs technologically advanced communications products and systems, from
basic components to turnkey systems for military, space, government and
commercial organizations around the world.
* * *
Statements made in this press release are forward-looking and are made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that these forward-looking statements reflect
numerous assumptions and involve risks and uncertainties which may affect
AYDIN's business and prospects and cause actual results to differ materially
from these forward-looking statements, including failure of L-3 Communications
Corporation to consummate the tender offer described in this press release, loss
of current customers, reductions in orders from current customers, or delays in
ordering by current customers, failure to obtain anticipated contracts or orders
from new customers, or expected volume from such customers, higher material or
labor costs, unfavorable results in litigation against AYDIN, the availability
of adequate sources of working capital and cash flow, and economic, competitive,
technological, governmental, and other factors discussed in AYDIN's filings with
the Securities and Exchange Commission.
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Contact:
Aydin Corporation, Newtown, PA
James R. Henderson
President and Chief Operating Officer
(215) 497-8288
E-mail: jhenderson@aydin.com
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