PEMBROKE, Bermuda (AP) -- Tyco Electronics Ltd. has agreed to sell its wireless systems business to government contractor Harris Corp. for $675 million in cash.
The maker of electronic components and undersea telecommunications systems also said Thursday it expects to report an operating loss of $3.6 billion to $4.1 billion for its fiscal second quarter ended March 27.
Tyco Electronics said the sale of the wireless systems unit, which makes wireless communications systems for law enforcement, fire and rescue workers and public service organizations, will help it focus on its core connectivity business.
The deal, subject to regulatory approvals and working capital adjustments, is expected to close this summer. Tyco Electronics said it will report the unit as a discontinued operation starting in its fiscal third quarter ending June 26.
The business, headquartered in Lowell, Mass., was formed in 1999 and grew through the 2001 acquisition of ComNet Ericsson. Melbourne, Fla.-based Harris said it will combine the business with its Harris RF Communications segment. It will be slightly accretive to Harris' earnings in fiscal 2010 before charges and contribute significantly to earnings in fiscal 2011 and 2012.
Tyco Electronics expects its second-quarter operating loss to include a noncash goodwill impairment charge of $3.3 billion to $3.8 billion due to significant sales and earnings declines, mainly in its electronic components segment. It also said it expects to report $135 million in charges related to the settlement of securities litigation and a reserve for remaining litigation.
Excluding charges, Tyco Electronics said it would report quarterly operating income of about $75 million.
Shares of Tyco Electronics rose $1.23, or 8.6 percent, to $15.50 in after-hours trading Thursday. In the regular session, the stock rose $1.27, or 9.7 percent, to close at $14.27.