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CPI International Inc. (CPII) announced the signing of a definitive merger agreement under which CPI International (CPI) will be acquired by an affiliate of Veritas Capital Fund IV (Veritas Capital) for $19.50 per share in cash. The purchase price reflects a premium of approximately 35 percent over the closing price of CPI common stock on November 24, 2010, and 38 percent over the average closing price of the CPI common stock for the 90 days ending November 24, 2010. The transaction is valued at approximately $525 M.

"Veritas Capital is pleased to be associated with the management and employees of CPI. The company has a long history of providing technology and product excellence to the defense, communications, medical and scientific markets. We look forward to continuing this tradition under our ownership, working with Joe Caldarelli and his team, by providing our customers with cost effective, advanced solutions to their important requirements," said Robert B. McKeon, Founder, Chairman and Managing Partner of Veritas Capital.

"With its extensive technology and defense industry experience and strong track record of fostering growth in its portfolio companies, Veritas Capital is an excellent partner for CPI. Our board of directors and management believe this transaction will provide considerable benefits for CPI's customers, and CPI's stockholders will benefit from a significant premium over the current stock price," said Joe Caldarelli, Chief Executive Officer of CPI. "We are very excited by the prospect of working with Veritas Capital to continue to grow CPI's business while providing our customers in all of our commercial and defense end markets with the state-of-the-art technology, dependable products and best-in-class customer service that they have come to expect from CPI. We will continue to support all the markets and product areas in which we are currently involved, and, in fact, expect to grow our participation in them."