Shares in

L-3 Communications Holdings

(LLL) - Get Report

rose Tuesday after the telecommunications-equipment maker said it will acquire

General Dynamics'

(GD) - Get Report

propulsion systems business unit for $185 million in cash.

The acquisition, which is expected to be completed in the first quarter of next year, is expected to add approximately $155 million to L-3's sales in 2005 and be accretive to L-3's results.

L-3 said the acquisition "expands our operations and maintenance capabilities into the land systems market and helps us to provide more capability to our customers."

Shares in New York-based defense contractor rose $2.08, or 2.8%, to $75.04 in heavier-than-usual trading volume. Some 1.3 million shares changed hands, versus the daily average of 781,000.

General Dynamics shares fell 37 cents, or 0.3%, to $107.98.