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Northrop Grumman to Acquire Essex Corporation for $24 Per Share Cash

Expands Company's Role in Government Intelligence Work

LOS ANGELES, Nov. 8 -- Northrop Grumman Corporation (NYSE:NOC) announced today that it has signed a definitive agreement under which Northrop Grumman will acquire for cash all of the outstanding shares of Essex Corporation (Nasdaq:KEYW) for $24 per common share. The transaction is valued at approximately $580 million, which includes the assumption of Essex's debt.

Northrop Grumman expects the transaction to close in the first quarter of 2007 and expects the transaction to be neutral to 2007 earnings and accretive beginning in 2008.

Essex Corporation provides signal processing services and products, and advanced optoelectronic imaging for U.S. government intelligence and defense customers.

"Our acquisition of Essex brings value to our shareholders, customers, and employees," said Ronald D. Sugar, Northrop Grumman chairman and chief executive officer. "Essex expands our position in C4ISR and further enhances our ability to serve our customers in the intelligence and defense communities. This transaction complements our existing capabilities and is consistent with our goal of investing in businesses that demonstrate the potential for strong and sustained growth."

Following the close of the transaction, Essex Corporation will operate as a business unit within Northrop Grumman's Mission Systems sector.

"Through its robust technical capabilities and performance, Essex has earned an exceptional reputation with its customers," said Jerry Agee, president of Northrop Grumman Mission Systems sector. "Its strengths in the areas of signal processing, information assurance, optics and optical processing, and systems engineering and integration will be a significant complement to our activities supporting the intelligence community and the Department of Defense."

The Northrop Grumman and Essex boards of directors have approved the transaction. Completion of the transaction is subject to customary conditions including Hart-Scott-Rodino approval and the approval of Essex Corporation's shareholders. Key Essex shareholders representing approximately 11 percent of the outstanding shares of Essex Corporation have entered into voting agreements pursuant to which, among other things, they have agreed to vote their shares in favor of the transaction.

Citigroup Global Markets Inc. acted as financial advisor to Northrop Grumman in this transaction.

Northrop Grumman Corporation is a global defense company headquartered in Los Angeles, Calif. Northrop Grumman provides technologically advanced, innovative products, services and solutions in systems integration, defense electronics, information technology, advanced aircraft, shipbuilding and space technology. With more than 120,000 employees and operations in all 50 states and 25 countries, Northrop Grumman serves U.S. and international military, government and commercial customers.

Note: Certain statements and assumptions in this release contain or are based on "forward-looking" information that Northrop Grumman Corporation (the "Company") believes to be within the definition in the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties, and include, among others, statements in the future tense, and all statements accompanied by terms such as "expect" and "guidance" or variations thereof. This information reflects the Company's best estimates when made, but the Company expressly disclaims any duty to update this information if new data become available or estimates change after the date of this release.

For a statement of the risk factors and uncertainties that may affect future performance, please refer to the Company's filings with the Securities and Exchange Commission, including, without limitation, Forms 10-K and 10-Q.

Contacts:

Dan McClain (Media)
(310) 201-3335
dan.mcclain@ngc.com

Gaston Kent (Investors) 
(310) 201-3423
gaston.kent@ngc.com