A report by financial services company Raymond James reveals that 125 mergers and acquisitions took place in the defense and government market during the third quarter of 2025, a 30 percent increase from the same period the previous year.
The November report was issued by Raymond James’ defense and government team, where Sam Maness, a previous Wash100 awardee, serves as a managing director.
How Active Was the Government & Defense M&A Market in Q3 2025?
According to the company’s market intel report, the aerospace and space/manufacturing segment accounted for 38 percent of total M&A activity in the third quarter. The government and defense technology sector followed closely with 35 percent, while the government services segment represented 27 percent.
In October 2025 alone, there were 31 M&A transactions, with government and defense technology deals making up 48 percent of the total.
By buyer type, strategic acquirers represented 55 percent of all transactions in Q3 2025, while private equity firms accounted for 45 percent.
Some of the M&A deals cited in the report are IBM’s move to buy Cognitus, a Dallas-based SAP services provider; the proposed acquisition of Cybereason by LevelBlue, a managed security services company; and SAIC’s purchase of SilverEdge Government Solutions from private equity firm Godspeed Capital.
What Are the Major Contract Awards Highlighted in the Report?
The Raymond James report highlighted several major defense and government contracts awarded to GovCon companies in October.
These include $2.7 billion in multiyear contracts secured by Boeing to produce additional PAC-3 seekers for the U.S. Army and prime contractor Lockheed Martin; a potential $1 billion contract awarded by Immigration and Customs Enforcement to BI to provide support services as part of the fifth iteration of the Intensive Supervision Appearance Program; and a $241.7 million contract awarded by the Naval Undersea Warfare Center Division Newport to SAIC for maintenance and upgrades at the Propulsion Test Facility in Rhode Island.
How Are Public Defense & Government Services Firms Performing?
The analysis also covered stock and financial performance among publicly traded companies in government services, defense technology, space and satellite, and diversified IT sectors.
Some of those public companies are CACI International, Booz Allen Hamilton, General Dynamics, ICF, KBR, L3Harris Technologies, Leidos, Northrop Grumman, Parsons and RTX.
