Telecommunications service Viasat sells its Link 16 military satellite communications system to L3Harris Technologies. The agreement will be finalized in early 2023.
L3Harris Technologies agrees to buy Military Communications
Telecommunications giant Viasat is selling its military satellite communications system, known as Link 16, for USD 1.96 billion. This became known on October 3. The buyer is L3Harris Technologies.
Link 16 is an encrypted communication system used by the US military and its NATO allies to transmit data between ships, aircraft and troops on the ground. It is also a key element of the main data transmission system of the Ministry of Defense Joint All Domain Command and Control.
In turn, L3Harris Technologies is one of the most important defense contractors of the US Department of Defense. Its annual turnover is USD 17 billion. It is expected that as a result of the transaction, the company will have access to all the most important communications of the US military, because the number of Link 16 terminals scattered across various military facilities around the world reaches 20 thousand.
Why is Viasat selling its business?
Link 16 is one of Viasat’s most profitable businesses. The division, which includes 450 employees, receives an annual profit of USD 400 million. This represents approximately 35 percent of the total revenue of the entire Viasat Government Systems.
It is not known whether this decision is somehow connected with the war in Ukraine, but it was the Viasat terminals used by the Ukrainian Armed Forcesthat were cyber attacked at the very beginning of the large-scale invasion.
In any case, analysts believe that the agreement will be very carefully considered by the American regulatory authorities, but still the Ministry of Defense will give permission for it without any problems, and it will be finally adopted at the beginning of 2023.
Viasat explains the sales of one of its most profitable businesses by the need to develop its own satellite network. In addition, in the near future, the company should survive a merger with Inmarsat worth USD 5.5 billion.
Problems with satellites
At the same time, the sale may be somehow connected with the development of a new communications satellite for the Ministry of Defense. For many years, Viasat has been a partner of the US military in this area, and their subcontractor was L3Harris Technologies.
However, now Link 16 satellites can only operate within the line of sight. Since 2019, Viasat has been developing a satellite that will allow communication beyond its borders, but its development is lagging behind the plan for years. So, it is quite possible that the US military believes that with the participation of L3Harris Technologies, business will go faster.
According to spacenews.com
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