Wachovia Says Titan-Lockheed Deal Unlikely
Wachovia thinks that a merger between Titan (TTN ) and Lockheed Martin (LMT ) is unlikely, and is keeping its investment recommendation on Titan shares at underperform.
Analyst Edward Caso says that Titan does not expect to complete its plea deal with the Department of Justice concerning allegations of violation of the Foreign Corrupt Practices Act by June 25, the deadline set in its merger agreement with Lockheed. Titan said that Lockheed is unwilling to extend its deadline, so Lockheed can now terminate the deal. Caso expects that to be the case. The analyst believes that Lockheed does not face a breakup fee. He does not see the emergence of any other potential acquirers for Titan until the DoJ issue is cleared up. Caso is keeping his earnings per share estimates at 76 cents for 2004 and 90 cents for 2005. With the loss of the deal, he expects Titan shares to trade in the $13 to $15 range.