L-3 Adds One

Monday was just another day at the office for L-3 Communications (NYSE: LLL), as the serial acquirer of defense shops tucked another acquisition into its bag of tricks.

Already partnered with privately owned Airborne Technologies on the "Cutlass" air-deployed UAV program, L-3 ripped a page from the Boeing (NYSE: BA) playbook this morning. It announced it's taking its partner in-house (for an unspecified sum).

Airborne Tech who?
Never heard of Airborne Technologies? Don't be embarrassed. According to L-3's press release, the Ashburn, Va.-based defense contractor is pretty small fry, bringing in only about $20 million a year in sales. But don't be misled by its size. Airborne Tech, or ATI for short, flies all over the unmanned-aerial-vehicle field.

According to its website, ATI has a hand in many of the hottest UAV projects now going. Its customer list includes DARPA, the DoD, Northrop Grumman (NYSE: NOC), and General Dynamics (NYSE: GD). It helped Lockheed Martin (NYSE: LMT) with the F-16, Boeing with the Airborne Laser, Northrop with its Global Hawk, and General Atomics with its Predator drone. ATI even appears to be involved in AeroVironment's (Nasdaq: AVAV) effort to build a small kamikaze UAV called the "Switchblade."

In short, ATI has an "in" with just about everybody who's anybody in the UAV industry. As such, this acquisition holds the potential to up L-3's game considerably, and give it a hand (and subcontractor revenue) in just about every UAV project on tap.

But at what price?
L-3's keeping mum on the purchase price for now, but if it ever discloses what it paid, I hope any investors allergic to high prices have their meds at hand. Prices in this industry are skyrocketing. When Textron (NYSE: TXT) purchased United Industrial Corp back in 2007, the acquisition cost it 1.7 times sales -- already expensive in an industry which usually tops out at a one-times-sales valuation. Later, Boeing opened up to purchase Insitu.

Considering the rate of UAV industry price inflation, I wouldn't be too surprised -- nor particularly pleased -- if the price tag on ATI goes as high as five times sales, to $100 million.

On the plus side, Textron's purchase netted it the very popular Shadow UAV, while Insitu gave Boeing a lock on ScanEagle -- and almost certainly helped Boeing win the Navy's STUAS/Tier II contract last month. So even if L-3's purchase turns out to be as pricey as I fear,  it may be worth it.

Further defensive Foolishness:

• Boeing's big win in the UAV wars.
• Britain's leapfrogging advance in unmanned aerial combat.
• General Dynamics' steady-as-you-go outperformance.