The acquired business lines are the Ottawa-based Space Science and Optical Instruments operation and a next-generation Search and Rescue Payload Product Line.

COM DEV is acquiring 23 employees with the Science and Optical Payload business and this operation will be relocated from its current facility to a new leased facility in the Ottawa area within the next six months.

Based on the existing contracts being assumed by COM DEV through this transaction the Company's backlog is increasing by approximately $18 million. This backlog is expected to be converted into revenue over the next five quarters.

"This acquisition is a very good fit with our core space business, and it significantly strengthens our position in the civil space market," said COM DEV CEO John Keating.

"The EMS operations are a profitable standalone business that we expect will contribute to our growth and provide an additional source of Canadian dollar revenues. Our target is to triple our market share of Canadian government space business over the next five years. On a separate front, I would also like to welcome our new employees to the COM DEV family."

Acquired businesses

COM DEV is acquiring two separate EMS operations:

1) The Space Science and Optical Instruments Operations, based in Ottawa. This business unit has a twenty year heritage in the design, fabrication, and testing of custom space-based optical and electronic instruments for space exploration, atmospheric research, plasma science, astronomy, and Earth observation. Technologies from these programs have also been utilized for a variety of spin-off instrument products for the International Space Station, commercial and military communication satellites, and various international space science missions.

COM DEV has worked as a principal subcontractor to this EMS unit for a number of years and is therefore very familiar with this business. As a result of this transaction, COM DEV becomes the prime contractor to the Canadian Space Agency for the Fine Guidance Sensor Instrument being supplied to NASA as Canada's contribution to the James Webb Space Telescope, which is the next- generation replacement for the Hubble Space Telescope.

2) The Search and Rescue transponder product line is currently built in St-Anne de Bellevue, Quebec, outside of Montreal. This EMS business is responsible for the design and manufacture of the satellite Search And Rescue Repeaters (SARRs) used on the SARSAT satellite payloads, which are part of the global COSPAS-SARSAT system developed by Canada, the USA, France and Russia.

First deployed 25 years ago, the space-based COSPAS-SARSAT system receives emergency signals from radio beacons deployed by downed aircraft, ships, boats and people in distress in isolated areas, and relays them to search and rescue authorities. Since the system was first deployed it has regularly evolved through successive new generations of equipment and has been credited with saving over 17,000 people. EMS' role in this international endeavor, building the satellite search and rescue transponders under contract to the Canadian Department of National Defence has generated revenues of approximately $100 million over the past 25 years.

The Search and Rescue product line will be transferred to COM DEV's Cambridge operations over the next few months once final government approval for this transfer is received. COM DEV also intends to continue working with the Ste Anne team and utilize them as a major subcontractor in this product area. The addition of the Search and Rescue product line builds on COM DEV's existing strength as a global leader in the supply of radio frequency (RF) transponder subsystems for global space markets.

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