Britain’s BAE Systems on Thursday said it has decided not to divest its United States-based government services businesses saying that retaining the units within the Intelligence & Security sector “delivers greater value” for the company.

The geospatial intelligence products of BAE's I&S sector are not part of a strategic asset review. Picture: BAE Systems
The geospatial intelligence products of BAE’s I&S sector will transfer to the Electronic Systems sector on Jan. 1, 2016. Picture: BAE Systems

“The business continues its good performance and order intake,” BAE said.

BAE in April announced a review of strategic alternatives for the U.S. businesses that provide a range of intelligence, IT and technical services mainly to the U.S. government. The Intelligence & Security sector operates as part of BAE’s U.S.-based subsidiary, BAE Systems, Inc.

The technology and product-focused geospatial intelligence business of the I&S segment will still become part of the Electronic Systems sector on Jan. 1, 2016 as previously announced,  BAE said.

BAE’s announcement that it is holding onto the U.S. services businesses follows various news reports in the past month that the company was close to a deal. On Wednesday Reuters reported that BAE was in advanced talks with the private equity firm Veritas Capital Management to sell the businesses for more than $1 billion.

BAE’s services businesses were on the market at the same time other large defense contractors said they were exploring options to shed their respective government services businesses including Lockheed Martin [LMT] and L-3 Communications [LLL]. Later this month, CSC [CSC] is scheduled to complete a spin-off of its U.S. Public Sector business into a new publicly-traded company called CSRA. Once it is spun-out, CSRA will acquire IT and professional services provider SRA International, which is currently owned by Providence Equity Partners.