Viasat stock soars after $2 billion deal to sell Link 16 TDL business to reduce debt, boost liquidity

Shares of Viasat Inc. VSAT, +26.93% soared 40.9% in morning trading Monday toward a 5 1/2-month high, after the communications company announced an agreement to sell its Link 16 Tactical Data Links (TDL) business to L3Harris Technologies Inc LHX, +4.60% in a deal valued at $1.96 billion. Viasat expects the deal to results in cash proceeds of $1.8 billion, after taxes, fees and other expenses, which the communications company expects to use to reduce debt and boost liquidity. Viasat’s stock started soaring after a trading halt for news was lifted at 9: 50 a.m. Eastern, and has been halted twice for volatility since then. The Link 16 TDL business had about $400 million in revenue over the 12 months to June 30. “This transaction will transform our balance sheet, reduce cash interest obligations, and sharpen strategic focus while enabling continued growth opportunities for the Link 16 business and assuring our customers of a competitive, innovative and reliable source for their future needs,” said Viasat Chief Executive Mark Dankberg. Viasat’s stock has dropped 24.6% year to date, while the S&P 500 SPX, +2.59% has lost 23.4%.