KBR Acquires SGT For $355M

0

Kam Ghaffarian

KBR, Inc. has acquired Stinger Ghaffarian Technologies Inc., expanding its portfolio to include high-tech support for government missions related to human space flight, the International Space Station, military and commercial space.

KBRwyle, a wholly owned subsidiary of KBR, will acquire SGT for an estimated price of $355 million, according to a KBR SEC filing. SGT brings a backlog of $3.4 billion in awarded government contracts, with no major recompetes for two years, and will expand KBR’s technology capabilities in tech solutions, engineering services, mission operations, science and research, IT software solutions, and modeling, simulation and data analytics, KBR said.

“SGT is a great company with very talented people and is the right fit for us as we continue to grow our government services portfolio and position ourselves to expand into new areas in line with our strategy,” KBR President and CEO Stuart Bradie said. “This is a strong cultural fit. Like KBR, SGT is a people company that operates with integrity and delivers strong results by putting customers and employees at the forefront of everything they do.”

The acquisition solidifies KBRwyle’s strengths in human space exploration, while opening up new opportunities in civil, military and commercial space, KBR said. KBR hopes the combined company will leverage NASA’s planned spending on deep space exploration, science, low-Earth orbit and spaceflight operations, as well as its plan to potentially use public-private partnerships or other commercialization to support the ISS.

KBR previously acquired Wyle and Honeywell Technology Solutions Inc. in 2016, and the addition of SGT will accelerate KBR’s plans to increase its technology and mission capabilities, the company said. KBR expects SGT to become a business unit within KBRwyle, and the company will maintain SGT’s current management structure to preserve a continuity of services during the transition.

Arena Strategic Advisors, LLC was the sole business adviser on the transaction. The acquisition is part of a trend of recent “mid-tier” deals in the government contracts space, such as On Assignment’s purchase of ECS Federal, according to Mike Kotarski and Matt Candy both managing directors at Arena.

“Companies with scale, enduring franchise positions, solid customer budgets and EBITDA visibility drive significant value for buyers,” they said. “Additionally, Kam [SGT President and CEO Kam Ghaffarian] purpose-built SGT for success with a culture focused on customers and employees, lean and efficient operations and a organization with a demonstrated track record of winning in a competitive market.”

KBR expects SGT to become a business unit within KBRwyle, and the company will maintain SGT’s current management structure to preserve a continuity of services during the transition.

“This transaction creates an exciting future,” Ghaffarian said. “As a combined entity, we will be able to bring powerful capabilities and solutions to the marketplace and broaden our service offerings for our existing customers. The alignment of the strong employee focused cultures and the combined business synergies makes this an ideal situation.”

WashingtonExec Membership for Executives in DC, MD, and VA - Sign Up Today

Comments are closed.