Viasat announced its deal to sell its Link 16 Tactical Data Links (TDL) business to L3Harris Technologies for $1.96 billion.

The sale is expected to result in cash proceeds to Viasat of approximately $1.8 billion.

Viasat’s Link 16 Tactical Data Link business is part of its Government Systems segment. The sale of the business includes the Multifunctional Information Distribution System (MIDS) platforms and associated next-generation Link 16 terminals and handheld radios, as well as the Link 16 to space business.

“This transaction will transform balance sheet, reduce cash interest obligations, and sharpen strategic focus while enabling growth opportunities for the Link 16 business and assuring our customers of a competitive, innovative and reliable source for their future needs,” said Mark Dankberg, CEO and Chairman of Viasat.

The Link 16 TDL business had $400 million of revenue and an estimated $125 million of Adjusted EBITDA for the 12 months ended June 30, 2022.

Viasat intends to use the proceeds of the Link 16 TDL sale to reduce net leverage and increase liquidity.

Viasat’s Government Systems segment would have generated $700 million in annual revenue for the 12 months ended June 30, 2022.

Viasat said its Government Systems segment will focus on three areas: broadband and narrowband Satcom services, networking and technology; information assurance and cybersecurity; and an emerging portfolio of space-based services, including LEO to GEO relay and networks for earth observation and sensor systems, alternate position, navigation and timing (PNT) and space situational awareness.