DRS Technologies on Friday said its $4 billion acquisition by Italian defense manufacturer Finmeccanica is on track and should close in the fourth quarter.

That statement from the American maker of defense electronics may finally lay to rest the speculation about the likelihood of another European company making a counter-bid for DRS.

Media reports had suggested that French defense electronics group Thales was considering a counter-bid for DRS. Despite DRS’s comments on Friday, don’t count Thales — or any of the European defense manufacturers — out yet.

Europe’s largest defense electronics company, Franco-German company EADS ( parent of Airbus), also wanted to counter-bid for DRS, but had said Finmeccanica’s offer was “too high.”

The Finmeccanica/DRS deal is expected to be just one of several acquisitions (or acquisition attempts, at the very least) by Europeans of U.S. defense companies, analysts have said.

U.S. defense spending — pegged at more than $500 billion for 2009 (excluding $100 billion for war-related costs) — is not expected to decrease in the next few years, regardless of who wins the presidential elections.

European companies looking to gain a presence in the U.S. defense market and get a piece of the defense budget — the world’s largest — are expected to target U.S. defense suppliers. DRS has already said it had received a higher offer from an unnamed foreign bidder and an expression of interest by a U.S. defense company.

And there is the parent company of French plane maker Dassault Aviation, which wants to acquire Alcatel-Lucent’s 20.8-percent stake in Thales.

Other possible targets include L-3 Communications, as well as Vought Aircraft Industries and Primus International — both of which were taken over by private equity firms who will eventually want an exit plan.

MID-DAY DEAL ROUND-UP 

A123 Systems, a Massachusetts maker of lithium-ion batteries filed today for a $175 million IPO, despite a week that has seen three more IPOs struggle. China Mass Media International Advertising started the week off by halving its IPO, then Rhino Resources, a coal company, pulled its IPO on Thurday. And on Friday morning, Rackspace Hosting saw its shares sink in their debut. 

Sprint Nextel is in talks to sell its iDen wireless network to either NII Holdings Inc  or private equity investors, according to CNBC, which that a sale of the network, which is used by public safety and construction workers, was not expected any time soon and did not name any sources for the report. The news comes a day after the embattled No. 3 U.S. wireless service canceled a $3 billion convertible sale it had announced the day before.

Elsewhere on the deals front, British Airways is confident it can submit an application to to get antitrust immunity in the U.S. for an alliance with American Airlines. American Airlines and BA already have an alliance through the 10-member oneworld alliance, but have twice tried and failed to win antitrust immunity for it.

3i is planning to sell its entire U.S. venture capital portfolio, or maybe only just a bit of it, according two conflicting sources cited by Private Equity Hub, which guesses it will only be a small part of the portfolio, since the sale is designed to generate about $100 million. 

Other deals of the day:

** Ford Motor Co has ended a plan to sell an interiors plant to parts maker Johnson Controls Inc because the downturn in the U.S. auto sector has made pricing the deal hard, the automaker said.

** Malaysia’s Maybank has bought another 5 percent of Pakistan’s MCB Bank for about 703 million ringgit ($213 million), raising its stake in the South Asian nation’s biggest lender to 20 percent, it said.

** Swiss luxury goods maker Richemont and South Africa’s Remgro said they are to spin off their jointly held 30.1 percent stake in British American Tobacco

**  Indicative bids for General Electric Co’s potential sale of its Australian mortgage business are due next week, but bankers do not expect a stampede as likely buyers grapple with the fallout of a global credit crisis.

** Spanish oil company Repsol and Portugal’s Galp denied a newspaper report that they were negotiating a possible merger.

The great auction-rate securities blood-letting banks have begun might well fill the bath if a lawsuit from Europe’s largest computer chip maker against Credit Suisse taps a legal vein. STMicroelectronics says the bank placed $450 million of its cash into auction-rate securities without authorization, and that there’s a lot more where that came from. “At least a dozen other multinational corporations are victims of the same scheme carried out by the same group of brokers and directors at Credit Suisse Securities and furthered by Credit Suisse,” the chip maker contends, adding that it believes more than $2 billion of these clients’ money ended up invested in auction-rate securities. Interesting that Credit Suisse should choose today to reinitiate coverage of the IT hardware sector with a “neutral” rating. Guess they aren’t taking a view of whether the challenge will be successful.
A 5.9 billion pound ($11.4 billion) writedown on risky assets sent Royal Bank of Scotland to a first-half loss of 691 million pounds – better than feared, but still one of the biggest losses in British history. RBS, Britain’s second-biggest bank, said the loss was “a chastening experience” but it was building a comfortable capital cushion and sales of assets were going as planned, although tough financial and economic conditions would continue.

Indicative bids for General Electric’s potential sale of its Australian mortgage business are due next week, but bankers do not expect a stampede as likely buyers grapple with the fallout of a global credit crisis. GE’s advisers, JP Morgan and Citigroup, have sent out information memorandums (IMs) to about 10 interested parties, including domestic and foreign banks. Commonwealth Bank of Australia, the nation’s second-biggest lender, was unlikely to bid, one industry source told Reuters. It declined comment. “People have had the IMs for a while … and they have to respond with interest next week,” said one person with direct knowledge of the matter. In May, GE said it was considering strategic options for Wizard Home Loans, a non-bank lender owned by GE’s financial services arm, GE Money. Local media have said GE Money paid about A$500 million ($455 million) to buy Wizard from its founder Mark Bouris in 2004.

Other deals of the day:

* Australia’s Newcrest Mining said it acquired an initial 30 percent stake in a Papua New Guinea gold mine joint venture, paying around $230 million to partner Harmony Gold.

* British investment company Guinness Peat Group said it sold its 29.7 percent stake in mid-sized insurer Tower Australia to Japan’s Dai-ichi Mutual Life Insurance.

* The controlling shareholders in Italian fashion group Mariella Burani launched a partial buyout offer for a 15 percent stake, bidding 17.5 euros per share