Strike two for
board Wednesday again sent its would-be suitor from Long Island packing, saying its sweetened $53-a-share buyout offer is financially inadequate. TRW also said it would consider strategic alternatives as it seeks to fend off the advances of Northrop.
Northrop also said first-quarter net income fell to $1.27 a share from $1.42 a year ago, although latest-period earnings were above the $1.09 Wall Street estimate. The company again guided analysts to full-year earnings of $6.60 to $7.10 a share, up from the $6.77 consensus.
For its part, TRW said first-quarter earnings rose 17% from a year ago, beating estimates, on cost-cutting, restructuring and strength in government business. First-quarter net jumped to 71 cents a share from 62 cents a year earlier. For the year, the company boosted its earnings target to between $3.55 and $3.60 per share from the earlier $3.30.
In March Cleveland-based TRW rejected a $47-a-share hostile bid from Northrop, saying Northrop was trying to take advantage of the departure of TRW chief David Cote. The latest merger proposal was valued at $6.8 billion, up from $6 billion originally.
TRW shareholders are scheduled to meet on April 22 to vote on whether the board should pursue the transaction.