EMS Technologies Inc. signed a definitive agreement for the sale of its Satellite Networks division to Advantech Advanced Microwave Technologies Inc., EMS announced Dec. 22. Advantech, based in Montreal, manufactures satellite and terrestrial wireless communication equipment,

“Satellite Networks has been a pioneer in the DVB-RCS arena, and will bring a deep technology base to Advantech in the growing arena of satellite broadband communications,” Alfred Hansen, president and CEO of EMS, said in a statement. “While I believe its operations have a bright long-term future in the hands of Advantech, it remains a small start-up venture whose orders stream is difficult to predict. Continued delays in orders, and resulting continuing losses and cash funding requirements, during the fourth quarter underscore that EMS and its shareholders are better served by a sale to a company like Advantech.”

EMS anticipates recording an additional impairment charge of about $2.5 million on the assets in the fourth quarter and may recognize additional losses through discontinued operations, EMS said. “The sales price anticipated under our previously announced non-binding letter of intent would not have resulted in a material further impairment charge, but as we completed the negotiations, it became apparent that the division’s disappointing prospects for fourth-quarter revenues and earnings could not support a transaction at that level,” Hansen said. “However, this transaction will still permit further reduction of EMS debt and also relieve the company of future [Satellite Networks] cash-funding requirements. This will also enable management to focus on our strong continuing operations and place us in a better position to capitalize on their promising opportunities.”

The parties are seeking to close the transaction as soon as possible, EMS said.