Defense firm buys U.S. Marine Repair
Advertiser Staff and News Services
ARLINGTON, Va. — United Defense Industries Inc. agreed to buy United States Marine Repair Inc., which repairs and modernizes non-nuclear Navy ships at Pearl Harbor, for $316 million.
Closely held U.S. Marine is working on the overhaul of the USS Chosin, an Aegis guided missile cruiser, at Pearl Harbor, said Richard Camacho, U.S. Marine's senior vice president for government and business development and a retired rear admiral.
Camacho said the sale of U.S. Marine will not affect its operations in Hawai'i, where the company employs a management team of 10 to 15 people.
U.S. Marine is working with Honolulu Shipyard Inc. on the Chosin contract, which is almost completed, and the two companies will cooperate on a new five-year contract to do scheduled maintenance on Navy surface ships, Camacho said.
U.S. Marine and United Defense are controlled by buyout firm Carlyle Group Inc. U.S. Marine had planned to hold a public stock offering, but canceled the plan when United Defense decided to buy it, Camacho said.
United Defense, the maker of the Crusader howitzer, agreed to buy U.S. Marine to add revenue from ship repair as it faces the loss of the Crusader contract. United Defense gets about a quarter of its sales from the Crusader, which may lose its Army contract after President Bush and Defense Secretary Donald Rumsfeld called for the $11 billion program's termination. The acquisition of U.S. Marine will add to earnings starting in the second half and increase profit by 5 percent to 10 percent annually, the company said.
U.S. Marine had net income of $12.3 million on sales of $431.7 million in the year ended March 31. Its customers include the U.S. armed forces and cruise-ship firms Royal Caribbean Cruises Ltd. and Carnival Corp.'s Holland-America.
The Navy is U.S. Marine's main customer. In addition to Pearl Harbor, U.S. Marine has operations in San Diego, San Francisco and San Pedro, Calif.; and Ingleside, Texas. The purchase will be completed by June 30, United Defense said.
