UPDATE 1-Veritas Capital to buy CPI Int'l for $19.50/share
* Deal at 35 pct premium to Wednesday close
* Shares rise 29 pct pre-market
Nov 26 (Reuters) - CPI International Inc CPII.O agreed to be bought by an affiliate of private-equity firm Veritas Capital for $19.50 per share in cash, three months after larger rival Comtech Telecommunications (CMTL.O) dropped plans to buy the telecom equipment maker.
The offer from New York-based Veritas Capital, which focuses on the defense and government-services sector, is at a 35 percent premium to CPI's Wednesday close. The deal is valued at about $525 million, CPI said.
In September, Comtech had offered to pay about $372 million in cash and issue about 4.4 million shares for CPI, in what could have been its largest acquisition ever. [ID:nSGE6490PZ]
Veritas Capital also owns Aeroflex Inc, a provider of microelectronic and testing equipment to aerospace markets, and Vangent, which provides information management and business processing services.
Earlier this year, Veritas sold military-services contractor DynCorp International to Cerberus Capital Management [CBS.UL] for $1 billion.
Shares of Palo Alto, California-based CPI, which makes microwave and radio-frequency products for defense, communications, medical and other applications, rose 29 percent to $18.65 in trading before the bell.
They have risen 43 percent over the last year. (Reporting by Saqib Iqbal Ahmed in Bangalore; Editing by Vinu Pilakkott and Don Sebastian) ((email@example.com; within US +1 646 223 8780; outside U.S +91 80 4135 5800; Reuters Messaging firstname.lastname@example.org))
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