NNSA Cancels $5B Nevada Site Mgmt Contract Award to NVS3T

ContractThe National Nuclear Security Administration has decided to revoke a potential $5 billion contract NNSA awarded to Nevada Site Science Support and Technologies Corp. earlier this week on grounds that NVS3T did not inform the agency it was acquired by Leidos Holdings (NYSE: LDOS) as part of the latter’s merger with Lockheed Martin‘s (NYSE: LMT) government information technology and services businesses.

NNSA on Monday announced NVS3T was to succeed National Security Technologies — a joint venture between Northrop Grumman (NYSE: NOC), AECOM (NYSE: ACM), CH2M and Babcock & Wilcox  as the management and operations contractor at the Nevada National Security Site for the next 10 years.

The agency said Wednesday the proposal NVS3T submitted during the acquisition process describes the business as a Lockheed subsidiary.

Lockheed wrapped up the spinoff and subsequent merger of its information systems and global solutions (IS&GS) segment into Leidos Aug. 16.

“This change in ownership raises substantial questions about the information in the NVS3T proposal, which could significantly impact the evaluation of the proposal and award decision, ” NNSA noted.

“In the interest of fairness, NNSA will reconsider all offers previously received in response to the request for proposals, ” the agency added.

NNSA said that NSTec’s current contract will remain in place until work commences on a new follow-on contract and that the agency’s decision to rescind the award to NVS3T will not affect the agency’s workforce or its national security missions.

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