BAE to fund deal using new debt and existing cash
BAE shares fall 3 in early deals
Ball Corp to use proceeds to cut debt, focus on packaging
Jefferies analysts say deal slightly expensive but good fit

Aug 17 Reuters Britain39;s BAE Systems on Thursday agreed to buy Ball Corp39;s aerospace assets for about 5.55 billion in cash, snapping up a key U.S. contractor in areas such as national security and intelligence.

Reuters had reported in July that private equity firms Blackstone Inc and Veritas Capital Fund Management were competing against defence companies such as BAE, General Dynamics Corp and Textron to buy the business.

Ball Corp, the world39;s largest supplier of beer cans, said it would use the proceeds to trim its 9.7 billion debt pile, return money to shareholders and speed up organic growth across its global packaging operations.

BAE, Britain39;s biggest defence company, plans to raise new debt and use cash to buy Ball39;s aerospace operations, which build spacecraft, instruments and sensors used among other things to monitor weather and climate change.

Shares in BAE Systems were down 3 by 0730 GMT.

We see this deal as a good fit, although slightly expensive, Jefferies analysts led by Chloe Lemarie wrote in a note.

The deal, which is expected to close in the first half of 2024, would add to its earnings per share and margins in the first year post completion.

BAE has benefited from increased military spending. This month it upgraded its earnings…