WASHINGTON — Services giant SAIC has completed its $2.5 billion acquisition of Engility, the company announced Monday.
The acquisition, made public in September, makes SAIC the second-largest government services contractor, behind competitor Leidos. It will comprise more than 23,000 employees.
SAIC stockholders will own roughly 72 percent of the combined company, and Engility stockholders approximately 28 percent.
In an interview with Defense News last September, SAIC CEO Tony Moraco said Engility’s “multi-intelligence agency portfolio,” along with the company’s space programs, made Engility an ideal target for SAIC.
“So for a single transaction at scale where we could in fact use our equity, [and face] probably fewer buyers, filling three or four of our strategic initiatives in market access and in capabilities — we felt it was worth a serious look,” he said.
It’s the biggest move yet in the services sector, which has recently seen significant merger and acquisition activity.
April saw the $9.7 billion buyout of CSRA by General Dynamics Information Technology. CSRA was a combination of former competitors Computer Sciences Corporation’s North American public sector business and SRA International.
In 2017, CSC merged another sector of its business with Hewlett Packard’s Enterprise Services arm (formerly EDS) to form DXC Technologies. In June, DXC spun off its U.S. public sector services and merged that with Vencore Holdings and KeyPoint Government Solutions to create Perspecta.
Amber Corrin in Washington contributed to this report.
Aaron Mehta was deputy editor and senior Pentagon correspondent for Defense News, covering policy, strategy and acquisition at the highest levels of the Defense Department and its international partners.