Harris Corp. puts broadcast division up for sale - WGEM.com: Quincy News, Weather, Sports, and Radio

Harris Corp. puts broadcast division up for sale; official says 'nothing different for employees'

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By DOUG WILSON
Herald-Whig Staff Writer

Harris Corp. officials told city officials they have been contacted by lots of interested parties since announcing Tuesday morning that they want to sell the Broadcast Communications Division.

Terri Black, director of marketing for Harris Broadcast, said nothing will change in the short term for the Quincy facility, where 384 people are employed.

"From a business perspective, nothing has changed. We remain part of Harris. There will be nothing different for any of our employees," Black said.

Harris President and CEO William Brown announced the strategic plan as he commented on the company's quarterly financial report.

"The decision to divest Broadcast Communications resulted from a thorough review of our business portfolio, which determined that the business is no longer aligned with the company's long-term strategy," Brown told the online newspaper Radio World.

"The plan to sell these assets supports our disciplined approach to capital allocation, and we intend to use the proceeds to return cash to shareholders and invest in growing our core businesses."

Chris Parsons, vice president of global operations for Harris, spoke by phone Tuesday afternoon with Spring and Jim Mentesti, president of the Great River Economic Development Foundation.

Mentesti said Parsons described the Quincy operation as "a very good asset" on the corporation's books, with a beautiful campus and state of the art equipment.

Spring said he is cautiously optimistic that Harris Broadcast will continue to be a major employer and the sale could be a big opportunity.

Harris is headquartered in Melbourne, Fla., and has about $6 billion in annual revenue and more than 16,900 employees. The company produces wireless equipment, electronic systems and antennas for use on earth and in space.

Black said the broadcast communications portion of the company employs about 1,700 people. Quincy's facility involves manufacturing for transmission and other devices. Another Harris Broadcast manufacturing facility is in Toronto, and there are different types of operations in Denver and in Ohio.

Harris officials attended the National Association of Broadcasters in Las Vegas recently to promote transmission equipment.

Tim Beeler, director of sales at Broadcast Electronics, said the Harris decision is "not a shocking thing, but surprising." Beeler said there have been various industrywide reports that this type of move might be imminent.

"It's a tough market, and someone finally decided it is a market they did not want to battle," Beeler said. "This will be interesting to watch. (Harris) has been in this town a long, long time. They're a great company with good, bright people. I hope it all works out."

Some broadcasters report that the markets in South America and Europe have been lukewarm. In North America, high-definition radio has not been as popular as expected.

Black did not agree with that description.

"Actually we're seeing a lot of good business opportunities. Central and South America are good markets. The Olympics are coming to London. The World Cup is going to Brazil ... and the Middle East is an extremely hot market," Black said.

"Things stumble as the economy stumbles, but I see the growth prospects (in broadcasting) outpacing the growth prospects in a lot of industries," she said.

Quincy Mayor John Spring said he received a call today from Harris about the prospective sale.

"It's a tough day, but they have to make the decision based upon what they think is right for their total business," Spring said. "We'll do everything we can to assist them and assist our workers here."

Spring is scheduled to have a conference call later in the day with Harris officials.

Harris officials declined to report what portion of the previous quarter's $1.48 billion in revenue could be attributed to the Broadcast Division.

Quincy has been home to broadcast firms since 1922 when Gates Radio was founded by Parker Gates and his parents in the earliest days of radio.

Gates Radio was purchased by Harris Intertype Corp., in 1957 and Harris entered the TV transmitter business in 1969.

Harris has grown through a number of acquisitions including: Allied Broadcast Equipment Corp., Intraplex and Pacific Research & Engineering, a part of Midwest Communications Corp., and many smaller operations.

Harris sold off its distributor business in 2007 and realigned its Broadcast Division into the Integrated Network Solutions arm last year.

Harris stock closed at $44.50 Tuesday, down $1.04.

Herald-Whig Staff Writers Matt Hopf and Steve Eighinger provided information for this story.

— dwilson@whig.com/221-3372

For more details:

http://blog.devoncroft.com/2012/05/01/harris-corporation-to-divest-broadcast-business/

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