Feeds

CACI: defence contractor gets defensive

Buying C-Cubed

  • alert
  • submit to reddit

Boost IT visibility and business value

CACI International, the IT services company that chiefly serves the US federal government, is to acquire C-Cubed, a provider of specialized defence and intelligence services. CACI's move looks to be largely defensive, as two of its rivals in the sector have recently been acquired.

CACI, which has not released details of the price it will pay for Springfield, Virginia-based C-Cubed, expects the purchase to close during October 2003. C-Cubed employs 400 staff, most of whom have high-level
security clearance. It provides technology for network enterprise solutions, systems integration, integrated logistics support, combat systems, and deep submergence engineering. The company made $49 million in revenue for the year ending June 20, 2003, with operating income of $3.2 million.

The transaction is anticipated to be accretive to CACI's financial performance for the fiscal year ending June 30, 2004. C-Cubed's clients include the Defense Advanced Research Projects Agency, Inland Revenue Service, and the Space and Naval Warfare Systems Center, Charleston.

The acquisition can be seen as a defensive move by CACI, which exists in the rapidly consolidating US government IT services sector. Two of CACI's rivals have been acquired by top-tier defense contractors in recent months.

Lockheed Martin earlier this month agreed to buy Titan for $2.4 billion, after paying $658 million for a "substantial portion" of the government sector business of Affiliated Computer Services, which gave it an additional 5,800 employees.

In June, General Dynamics signed a deal to buy Veridian for $1.5 billion in cash and assumed debt, adding $2 billion in additional revenue to the company's IT and network systems business with clients including US Air Force, the State of Texas, the US Navy, the US Army, and the US Coast Guard.

Prior to this in December, Computer Sciences Corp snapped up DynCorp for $1 billion.

Consolidation is driven by IT services providers scaling up to compete for a slew of major long-term government contracts, originating mainly from the new Department of Homeland Security, which is now the single largest US federal agency with a budget of $37.7 billion to invest in IT systems and infrastructure. The sector is also experiencing major investment from the General Services Administration Millenia project, which has a budget of $25 billion to invest in federal government IT services projects over an indefinite time period.

Source: ComputerWire/Datamonitor

Related research:

Datamonitor, "Technology spending plans in the UK Public Sector"

The Power of One Brief: Top reasons to choose HP BladeSystem

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.