General Dynamics announced that it has signed a definitive agreement to acquire newport news shipbuilding. The transaction is valued at approximately $2.6 billion, which includes the assumption of approximately $500 million of newport news shipbuilding debt. The tender offer will begin within seven business days. The acquisition, subject to the tendering of a majority of the newport news shipbuilding shares as well as regulatory review, is expected to close in the third quarter of 2001.

"newport news is a solid, well-run company with sustainable revenues and earnings and strong cash flow. Our offer reflects its inherent worth, offers newport news shareholders an attractive premium, and provides a wonderful opportunity to save significant amounts of money for the U.S. Navy while retaining both nuclear shipyards, " said Nicholas D. Chabraja, general dynamics chairman and CEO.
William P. Fricks, chairman and CEO of newport news shipbuilding, said, "This acquisition will provide newport news shareholders an attractive price, and our employees will benefit from being part of a larger, more diverse company.

It will enhance job security, and provide more career choices in a wider enterprise. Today, newport news is the nation’s sole supplier of aircraft carriers, and we’re teamed with electric boat on the Navy’s only new submarine program. Combining our companies will provide our customers with significant cost savings to support the nation’s need to build more nuclear ships."