MSI views going forward

I thought the results were reasonable and was very surprised when the shares dropped by 10-13% this morning. I used this as an opportunity to top up and this is now one of my top 3 holdings. This statement reinforced a view I had that there is a likelihood that MSI is taken over at some point. This view had a few underlying conditions which are now all coming into play.

1. Michael Bell retires. This statement announced just that
2. Forgings and Petrol Structures divisions are divested. Again, this is happening and I suspect they will both be sold within the next 12-18months.
3. Markets support M&A. Again, once MSI becomes a defensive pure play, this would be an easy target. I suspect a company like BAE would acquire it. (see recent video of their collaboration with MSI https://www.baesystems.com/en-uk/article/new-counter-drone-capability-test-proven-in-a-matter-of-months )

So lets see how this one plays out, but I think takeover at a juicy valuation in the next 2-3yrs has at least 30% probability.