The consulting and professional services firm Booz Allen Hamilton [BAH] yesterday said it has agreed to acquire the defense engineering services business of ARINC, Inc., for $154 million in cash, a deal which will bolster its engineering capabilities and help it address adjacent market opportunities.
Booz Allen expects the acquisition to close later this year subject to regulatory reviews.
The private equity firm The Carlyle Group, which owns ARINC, is divesting the Defense Systems Engineering & Support (DSES) division due to federal organizational conflict of interest rule changes. The pending sale followed a review by Carlyle of its exit strategy of ARINC, an ARINC spokeswoman told Defense Daily.
ARINC will retain its aerospace business, which also serves military customers.
The DSES division has capabilities in aviation and maritime engineering, advanced weapons modernization and sustainment, and advanced systems engineering and integration. Booz Allen said the business is well positioned in the C4ISR and engineering services and prototyping segments of the defense market. It also said the division will complement its existing services work.
Booz Allen also said that it believes that DSES has opportunities to expand its work into the intelligence, law enforcement, homeland security and international systems sectors.
“DSES is a good strategic fit that builds on Booz Allen’s existing engineering capabilities and defense market position and offers opportunities for us to bring deeper and broader expertise to our clients in areas where we see a number of compelling opportunities,” Ralph Shrader, chairman and CEO of Booz Allen, said in a statement.
The DSES unit is based in Maryland and has about 1,000 employees.
ARINC said the sale will enable it to invest in and expand its mission systems and solutions efforts for airports, trains, aircraft modernization for aging government aircraft, public safety radio networks and high-end security systems for critical infrastructure.