| Linkabit Wireless, Inc. | |||
| Proposed Ticker: | LBIT | 3033 Science Park Road | |
| Exchange: | NASDAQ-National Market | San Diego, CA 92121 | |
| Industry: | Manufacturing (SIC Code 3663) | (619) 552-9500 | |
| # of Employees: | 193 | ||
| Type of Shares: | Class A Common Shares | Filing Date: | 12/8/97 | |
| U.S. Shares Filed: | 2,700,000 | Filing Range: | $12.00 - $14.00 | |
| Non-U.S. Shares Filed: | 0 | Offering Amount: | $35,100,000 | |
| Primary Shares: | 2,700,000 | Expenses: | $900,000 | |
| Secondary Shares: | 0 | Shares Out After: | 10,500,000 |
| Manager | Tier | Phone |
| SBC Warburg Dillon Read, Inc. | Lead Manager | |
| C.E. Unterberg, Towbin | Co-manager | (212) 572-8060 |
| Needham & Company | Co-manager | (212) 705-0344 |
| Issuer's Law Firm: | Cooley Godward Castro Huddleson & Tatum |
| Bank's Law Firm: | Brobeck, Phleger & Harrison |
| Auditor: | Arthur Andersen |
| Registrar/Transfer Agent: | American Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 9 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 9/30/97 | 9/30/96 | 9/30/97 | ||
| Revenue: | $27.85 | $34.62 | $18.95 | Assets: | $26.99 |
| Net Income: | -$3.68 | -$1.29 | -$3.00 | Curr Assets: | $22.52 |
| EPS: | -$0.46 | -$0.16 | -$0.37 | Liabilities: | $5.90 |
| Prior EPS: | -$0.16 | -$7.42 | -$2.64 | Curr Liabilities: | $5.40 |
| Cash Flow/Oper: | -$7.00 | Equity: | $21.09 | ||
| Cash Flow/Fin: | -$1.06 | -$1.15 | Cash: | $0.00 | |
| Cash Flow/Inv: | -$1.81 | -$1.06 | Working Cap: | $17.13 | |
| Business Description |
| The company specializes in the development and production of advanced satellite ground terminals, satellite voice/data modems, networking systems and other products used to provide bandwidth efficient communications for commercial and government customers The Company's market driven product development efforts have resulted in products which are particularly well suited for two significant market opportunities, rural telephony and secure defense communications. Linkabit Wireless has developed substantial expertise in Demand Assigned Multiple Access ("DAMA") technology and critical engineering disciplines such as satellite ground system design, RF and digital engineering, digital and communications signal processing software, network management and modem technology. The Company has benefited from substantial and continued investment in its technology and products. Since 1986, the U.S. government, third parties and the Company have collectively invested over $250 million in the Company's research and development programs. A significant portion of this investment has been focused in the area of DAMA technology which enables more cost-effective and efficient use of satellite transmission capacity and allows each ground terminal in a satellite network to communicate with any other terminal in the network. The Company's commercial products leverage the advanced technologies and broad technical competencies developed from the substantial investment in its government business. Similarly, the government business has benefited from the Company's investment in the design and production of cost-effective commercial products which can satisfy the government's demand for more commercial off-the-shelf ("COTS") products. |
| Competition |
| The industries and markets in which the Company competes are highly competitive, and the Company expects that competition will increase in such markets. The Company encounters intense competition in most of its business areas from numerous other companies, including large and emerging domestic and international companies. Some of the Company's competitors in the secure defense communications market include GEC (UK), Raytheon Corporation, Rockwell International and ViaSat, Inc. Some of the Company's commercial competitors include Gilat Satellite Networks Ltd., Hughes Network Systems, Scientific Atlanta Inc., STM Wireless Inc. and ViaSat, Inc. A number of the Company's competitors have far greater financial, engineering, technological, marketing, sales and distribution and customer service resources than the Company. As a result, such competitors may be able to develop and expand their products more quickly, adapt more swiftly to new or emerging technologies and changes in customer requirements, take advantage of acquisition and other opportunities more readily, and devote greater resources to the marketing and sale of their products and services than can the Company. In addition, current and potential competitors in markets in which the Company competes have established or may establish cooperative relationships among themselves or with third parties to increase the ability of their products and services to address the needs of the Company's current and prospective customers. Accordingly, it is possible that new competitors or alliances among competitors may emerge and rapidly acquire significant market share. Increased competition is likely to result in price reductions, reduced profit margins and loss of market share, any of which would have a material adverse effect on the Company's business, results of operations and financial condition. The Company's ability to compete in its markets depends to a large extent on its ability to provide technologically advanced products and services with shorter lead times at lower prices than its competitors. There can be no assurance that the Company will be able to compete successfully against current or future competitors or that competitive pressures will not have a material adverse effect on the Company's business, financial condition and results of operations. The Company also is dependent on the continued success and development of the satellite communications industry in general, which itself competes with other technologies such as terrestrial wireless, copper wire and fiber optic communications systems. Any failure of the satellite communications industry to continue to develop, or any technological development which significantly improves the capacity, cost or efficiency of competing systems relative to satellite systems, could have a material adverse effect on the Company's business, financial condition and results of operations. |
| Business Plan |
| The Company's goal is to become a preeminent solutions provider to emerging communications markets in developing countries, international commercial sectors and in the U.S. and allied defense markets. The Company's strategy to achieve this goal includes the following primary components: (I) Pursue Global Rural Telephony Market, (ii) Expand Defense and Government Business, (iii) Remain on Leading Edge of Technology, (iv) Leverage Technology and Capabilities Into Other Markets, (v) Expand Strategic Alliances and (vi) Core Technologies and Capabilities. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for working capital, general corporate purposes and potential acquisitions. |
| Name of Shareholder | % Owned Before | % Owned After |
| The Titan Corporation | 100.00% | 74.30% |
| Officer Name | Title | Age |
| Gene W. Ray | Chairman of the Board | 59 |
| Eric M. DeMarco | Chief Financial Officer | 34 |
| Ronald B. Gorda | Chief Operating Officer | 42 |
| J.S. Webb | Director | 78 |
| Frederick L. Judge | President, Chief Executive Officer and Director | 63 |
| Scott C. Smull | Vice President, Finance | 45 |