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I come from Alliant tech systems or ATK
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as as as we're more well known um it's
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A5 billion midcap Public public company
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uh 18,000 employees uh four business
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groups uh Armament systems uh Aerospace
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system security and sporting uh and
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missile products uh we are the world's
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largest ammunition provider um both
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small Cal and medium Cal uh we are also
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the world's um um a market leader in
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solid rocket motors for space launch and
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for strategic missiles um we're also a
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leading producer of commercial
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ammunition and accessories both for the
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sporting Enthusiast as well as for law
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enforcement well it's interesting
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because uh you know you know uh as as
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strategic agility obviously implies um
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the ability to move quickly um you know
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uh change is is not uh is something
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resisted in in The Human Condition uh
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it's even more complicated when when
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you're in an organization a complex
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business
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organization um we at ATK have have
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recognized that we are at an inflection
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point and that's a phrase that that is
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now becoming much more um commonplace in
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in the Lexicon of the defense industry
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and that we need to react accordingly um
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you know our company is facing uh
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considerable Market headwinds um in our
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core markets of ammunition propulsion uh
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we Face challenges that our customers
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are facing in terms of uh I'll say
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budget pertubations in the US government
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environment um so we need to react we
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need to adapt accordingly and um you
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know one of the things when I look back
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at
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ATK uh and it's Rich very rich history
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we've been very successful in affecting
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what I call affecting a pivot and a
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pivot is a a strategic choice or a
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series of strategic choices that lead to
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New Growth Pathways for the company and
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those new growth Pathways can be
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achieved either organically or
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inorganically and our company's history
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we've done all of that and uh we started
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as a$1 billion company an offshoot from
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Honeywell and today we're 5 billion and
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we've established Market Market
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leadership positions in a number of
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different
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areas well I you know really there are I
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guess um four fundamental pivot options
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if you will broadly defined once one is
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to essentially double down and
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consolidate core positions and await for
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an upswing in the defense cycle um and a
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second option would be to acquire uh New
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Growth Platforms in our existing or
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traditional defense uh Spa defense space
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and security Market broadly defined um
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third would be looking at uh
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international business expansion and
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four is something what I I'll call smart
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commercialization uh ATK uh by virtue of
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the fact that we have 30% of our annual
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revenues coming from commercial
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businesses we're not held captive to
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what I'll call the true defense play
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investment thesis um so we have the
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ability to actually pivot um into
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commercial businesses that are
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complimentary to our existing portfolio
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that represent maybe one degree or 1.5
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degree Freedom away from our core space
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so we're looking very intently on on
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those types of opportunities that U say
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restore balance to our portfolio that
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adds a countercyclical dimension to our
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portfolio I mean when you look at we've
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we've been identifying a series of
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growth vectors if you will and uh for
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example we we have um uh we we we've
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already penetrated the commercial
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Aerospace Market by virtue of being a
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supplier on the a350xwb for for Airbus
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so we're looking at opportunities um to
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perhaps grow in I'll call Integrated
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Arrow structures um and you know um and
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looking not only how we can do that
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organically but also looking looking at
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uh inorganic options to facilitate that
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expansion uh we're we we are a Safety
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and Security Company um by virtue of all
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the things that we're doing both in the
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security and sporting realm as well as
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in our armaments realm so we're looking
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at opportunities perhaps maybe marring
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our our core Heritage in advanced
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products or I'm sorry Advanced Materials
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and engineered products and looking at
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opportunities where we can develop new
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Safety and Security capabilities um that
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we can then I'll say productize and U
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move into either the military space or
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introduced to the military space as well
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as in introductions into the commercial
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space looking at s like U what I'll call
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materials and intermediates Ceramics and
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how do those Ceramics then um how can
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you leverage those capabilities or the
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I'll say the um the Upstream uh
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materials capabilities and looking at uh
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you know perhaps new um uh um uh sappy
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plates uh plates armored plates for for
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self- protection um looking at um you
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know um looking at different different
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uh propellants if you will and how how
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we can create new new weapons both in
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the military space as and as well as in
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the defense in the commercial space as
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well you know I I think one of the
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things that we we look at and it's it's
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very easy to
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ignore um those small companies uh as
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we're you know especially in the
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environment that we face and you do so
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at your peril uh you one of the things
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from an acquisition perspective we're
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very careful of is not um you know not
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by acquiring these companies you you
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stifle their entrepreneurial
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creativity uh you know it's really these
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companies are forc multipliers um and uh
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many companies don't have a systematic
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approach to um you know identifying um
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and and and and transacting strategic
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Partnerships whether they're joint
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technology development arrangements or
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perhaps they're you know um companies
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like ATK and and the larger companies
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will um you know transact an equity you
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know an equity ownership um position in
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in those small companies um it's a
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slippery slope though because you know
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at the at the end of the day it's all
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about control um in those transactions
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so um the answer to your question I
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think is more um you know ATK is more
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interested in in perhaps um well
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developing relationships to seed new
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technologies uh and those Tech and
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seeding those Technologies might come in
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the form of a joint technology
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development Arrangement um and I think
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the the the equally important is
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ensuring that those folk the smaller
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companies feel like they're Partners not
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suppliers um you know it's it's very
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it's very common for larger companies to
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look at the smaller guys and and um and
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not give them a seat at the table and I
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think you know it's it's uh if you're
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not careful um those relationships um
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break down very quickly being in ATK now
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for four and a half months this is my
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fifth month um I I can give you examples
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of of companies in the past you know
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I've in in in a former life uh we uh
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developed a um an equity relationship
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with uh a company in Australia um and it
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was a it was a crown it's a crown jewel
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technology company in Australia that was
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um making like you know a technology for
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phased array Radars uh and so we were
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able to leverage that companies um um
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not only the it's it the Crown Jewel
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technology but also so the folks that
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work there and we're able to to take
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that and move into um new forms of of
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surveillance Radars groundbased
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surveillance Radars air uh air
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surveillance Radars um and it was a it's
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it's a very it was a very productive and
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healthy relationship but at the same
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time you know like with anything if
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you're not careful managing that
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relationship things break down very
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quickly so it's a something that's
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always in the Forefront of my mind when
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when I'm looking at contemplating um
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relationships with smaller companies
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um I would say I'll say a cultural
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misalignment and it does I'm not talking
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about National culture it's
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organizational culture misalignment um
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you know uh you know understanding you
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know uh the smaller companies are are at
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a different phase of their life cycle
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relative to the larger companies and um
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uh they have their own needs um they
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have their own priorities especially if
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if they're a private company that have
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have aspir ations to become a public
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company and through a liquidity event um
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so you know aligning their culture with
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with with with the larger company's
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culture aligning their aspirations with
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your aspirations and and and you know in
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many many cases if you're not careful um
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that misalignment could you know cause
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things to break down very
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quickly
