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Executive Mosaic’s Weekly GovCon Round-up: Wash100 Update & the CSRA Acquisition

Weekly Roundup
March 19 – March 23, 2018

Wash100 Update & the CSRA Acquisition 

Jim Garrettson, Executive Mosaic CEO

The popular vote for the Wash100 continues this week! Voting turn out has been strong since the January 25th launch of the popular vote, and all of us at Executive Mosaic extend our thanks to those who have participated. If you have yet to place your ten votes for the executives that you believe will have the greatest influence on the government contracting landscape over the course of the next year, please visit the Wash100 voting page by April 30th.

The current top five executives are:

In the past month the acquisition of CSRA has been underway. Initially, it seemed apparent that General Dynamics would be purchasing the Falls Church, VA-based government IT services contractor, but in the last week the acquisition of CSRA developed into a bidding war between General Dynamics and CACI International. Here’s a look at the events that transpired between the three companies and where the acquisition process currently stands.

In mid-February, General Dynamics announced that it had agreed to purchase CSRA for approximately $9.6 billion. General Dynamics said that it would pay $40.75 in cash for each share of CSRA stock, amounting to approximately $6.8 billion, and would assume CSRA’s $2.8 billion in debt. Phebe Novakovic, chairman and CEO of General Dynamics and 2018 Wash100 recipient, said that the acquisition would enable General Dynamics’ IT business to expand its capabilities and client base and better provide IT platform services to the intelligence, defense and federal civilian sectors. Larry Prior, president and CEO of CSRA and 2018 Wash100 recipient, said that the combination of General Dynamics’ IT business and CSRA would create an entity “with a full spectrum of enterprise IT capabilities.”

On March 18th, however, CACI International announced its proposal to acquire CSRA for $44 per share in cash and stock, which comes out to approximately $7.2 billion. In a company press release, CACI said that its board had unanimously voted to go ahead with the acquisition proposal. CACI’s proposal came about a month after General Dynamics’ offer and proposed to purchase CSRA for a greater sum without inheriting the company’s $2.8 billion debt.

A few days after CACI’s bid, General Dynamics increased the value of its proposal, offering to purchase CSRA for $41.25 per share, approximately $6.9 billion in cash, as well as assuming CSRA’s $2.8 billion debt. In a press release from March 20th, General Dynamics noted that its tender offer for CSRA’s shares began on March 5th and that the price increase took effect on March 20th. General Dynamics and CSRA expect to close the deal once the tender offer is completed on April 2nd. Upon completion of the acquisition, General Dynamics will run CSRA as a wholly owned subsidiary.


Weekly Contract Awards
This week’s top GovCon contract awards: BAE Systems, Black Box, BWX Technologies, Lockheed Martin, Huntington Ingalls Industries, and Vectrus, among others.
CACI Offers $7.2B Cash & Stock for CSRA
CACI International has offered to acquire CSRA for approximately $7.2 billion in cash and stock, or $44.00 per share, in a bid to form a combined entity that will deliver mission services and enterprise support offerings to government clients.
Jacobs Lands $778M USSOCOM IT Support Contract; Darren Kraabel Comments
Jacobs Engineering Group has received a potential five-year, $778 million contract to provide the U.S. Special Operations Command with information technology enterprise operations and maintenance support services.
Patrick Nicolet Named Capgemini Group CTO
Patrick Nicolet, formerly head of the competitiveness program and India operations at Capgemini, has been appointed as group chief technology officer.
Mary Louise Krakauer Joins DXC Board of Directors; Mike Lawrie Comments
Mary Louise Krakauer, formerly executive vice president and chief information officer at Dell Corp., has been appointed to DXC Technology‘s board of directors.
Boeing-Sikorsky Team Tests SB-1 Defiant Helicopter in Preparation for Maiden Flight
Boeing and Lockheed Martin’s Sikorsky subsidiary have begun testing the SB-1 Defiant coaxial helicopter in preparation for its initial flight as part of the U.S. Army’s Joint Multi-Role program, Defense News reported Wednesday.
David Shulkin: VA to Incorporate Mitre Interoperability Review Recommendations Into EHR Contract
Veterans Affairs Secretary David Shulkin has said an electronic health record interoperability review conducted by Mitre resulted in 51 recommendations that are now being integrated into a contract that VA intends to award to Cerner.
CACI, ManTech Win Spots on $17.5B DISA Encore III IT Services IDIQ; Ken Asbury, Daniel Keefe Comment
CACI International and ManTech International have secured positions on a potential 10-year, $17.5 billion contract vehicle for information technology platforms and services awarded by the Defense Information Systems Agency.
Air Force, NATO Conduct Study to Address Pilot Shortage
The U.S. Air Force and NATO have partnered to deal with pilot shortage, a problem that other NATO members have also been experiencing.
Northrop Vet Michael King Named Peraton Chief Growth Officer; Stu Shea Comments
Michael King, formerly vice president of business development at Northrop Grumman’s cyber and intelligence mission solutions division, has joined Peraton as chief growth officer.

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