ManTech International [MANT] earlier this week said it has agreed to acquire Sensor Technologies Inc. (STI), a small contractor that has a prime position on the Army’s Strategic Services Sourcing (S3) contract, for $242 million in cash.
The deal is expected to close the transaction early next year subject to various closing conditions and approvals, including Hart-Scott-Rodino. ManTech said the deal will accretive to earnings per share in 2010.
New Jersey-based STI is expected to have about $340 million in sales this year and $450 million next year. The company’s earnings before interest, taxes, depreciation and amortization margins are in the mid to high single digits, a ManTech spokesman told Defense Daily.
STI provides mission critical systems engineering and C4ISR services and solutions primarily to the Army’s Communications-Electronics Command under the S3 contract. The company offers specialized services supporting program management offices across the Army in the areas of biometrics, human terrain systems, communications and ISR.
So far STI has received a potential $2.5 billion in task orders under the S3 indefinite delivery, indefinite quantity contract. The ManTech spokesman said that S3 accounts for over 90 percent of STI’s revenues.
“Together we will support the ISR surge in theater and provide the quick response capabilities that the Army demands going forward,” Lawrence Prior, ManTech’s president and chief operating officer, said in a statement.
George Pedersen, ManTech’s chairman and CEO, said the pending acquisition is consistent with his company’s strategy to broaden its “footprint in the high-end defense and intelligence market…With the defense appropriation bill on track and a clear mission and strategy for Afghanistan, this acquisition allows us to provide more direct support to the Army as it continues its overseas operations and prepares for the next generation of national security.”
STI’s financial advisor on the deal is Lazard.