Home / News / Weekly Roundup July 11 – July 15 2016: Boeing Throws Hat Into Defense Services M&A Mix & more

Weekly Roundup July 11 – July 15 2016: Boeing Throws Hat Into Defense Services M&A Mix & more

July 11 – July 15 2016

A Note From Our President & Founder Jim Garrettson

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One of the world’s two largest airplane manufacturers is mulling acquisitions in the defense services arena that would continue a trend among prime contractors toward capability-based deals.

Leanne Caret, CEO of Boeing’s $30.4 billion defense segment, told a group of journalists at the U.K. Farnborough International Airshow Sunday the company wants any acquired company to act as a “bolt on” and contribute additional revenue, per a Bloomberg report.

Hardly any acquisition by a prime contractor would be able to top either Lockheed Martin’s $9 billion buy of the helicopter maker Sikorsky announced around this time last year or Harris’ $4.7 billion purchase of Exelis in May to significantly alter the landscape.

The more significant trend among larger and middle-tier primes within the last two years has been to pursue targeted deals with twin goals to add new technologies and also gain access to new agency customers.

Raytheon has given us two examples of those types of buys via the missile maker’s $425 million acquisition of cyber and special operations contractor Blackbird in November 2014, plus network defense company Foreground Security for an undisclosed sum almost one year later.

The C4ISR arena has been active as San Diego-based Cubic Corp. invested $386 million to purchase of three defense technology makers during 2014 and 2015, while L-3 Communications bought Nashville-based ForceX in October 2015 for new surveillance and geospatial tools as part of its larger reposition toward the defense technology arena.

Additionally, General Dynamics snapped up the underwater drone maker Bluefin Robotics earlier this year to add new unmanned manufacturing work for the Navy and bring in 50 skilled workers with experience in the field.

How the big primes are repositioning themselves in a ever-changing global security and government spending environment will surely be on the minds of Wall Street analysts starting next week when Lockheed officially kicks off GovCon’s second quarter earnings season Tuesday.

THE WEEK’S OTHER TOP 10 GOVCON STORIES

CMS Awards Potential $2.5B Medicare, Medicaid Anti-Fraud Services Contract Vehicle
Task orders under the Unified Program Integrity Contract initiative will be awarded across geographic areas with multiple states in each.
Former PAE Chief Mike Dignam Named CRDF Global President, CEO
Dignam led PAE through its 2011 sale to Lindsay Goldberg from Lockheed Martin and takes the same role at science and technical nonprofit CRDF.
Socom Picks Battelle for Commercial Vehicle Procurement, Lockheed for Dry Combat Submersible Development
Special Operations Command gives out $336 million in contract funds to the nonprofit Battelle and Lockheed via two separate technology programs.
7 Companies Land Spots on $142M Defense Contract Administration System Support IDIQ
DCMA will award work on a task order basis to service the agency’s “Mechanization of Contract Administration Services” system.
SAP NS2’s Mark Testoni: Data Digitization, Open Source Platforms Could Help in Law Enforcement, Intell Operations
Testoni offered his perspective on the technologies’ potential uses for government agencies worldwide in an interview with CNBC Asia.
Thales Alenia Space-Orbital ATK Team Completes 1st Batch of Iridium NEXT Satellites; Matt Desch Comments
SpaceX is scheduled to carry an initial batch of satellites into space Sept. 11 with a second launch scheduled for September.
Out of the Fog Research, Hypres Land Cryogenic RF Tech Contracts With Navy
Both companies will work with the Navy on research-and-development work to develop the cryogenic, core digital and quantum memory technologies.
VA to Procure Enterprise Cloud Services Through NIH NITAAC Contract Vehicle
The Department of Veterans Affairs aims to migrate data to cloud computing environments via services sought under NITAAC.
White House Unveils Strategy to Help Agencies Recruit, Retain Cyber Professionals
Government agencies want to take in 3, 500 information technology and cybersecurity staffers altogether by January 2017.
Rear Adm. Scott Jerabek Named DTRA Deputy Director
Jerabek will help oversee an agency responsible for collaborations with military service branches and combatant commanders to counter and destroy WMDs.

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