Britain’s QinetiQ recently said it has agreed to acquire Northern Virginia-based Dominion Technology Resources, Inc. (DTRI), a provider of various professional services to the United States intelligence community, for upward of $165 million in cash.
The pending transaction would expand both QinetiQ’s growing North American operations and the work it does for the intelligence community. Early last year QinetiQ acquired Analex Corp., which gave the company a presence in the U.S. intelligence community (Defense Daily, Jan. 24, 2007).
QinetiQ says that DTRI’s core expertise is in mission architecture engineering, integration and operations support.
“DTRI operates in an important, fast growing market, which is typically difficult to enter,” Graham Love, QinetiQ’s CEO, said in a statement. “Very importantly, DTRI brings new customer relationships from within the U.S. Intelligence Community and provides us with further growth opportunities within the broader North American market.”
DTRI, which has over 100 employees and has grown from $12.4 million in sales in 2004 to $46.6 million last year, has a $397 million backlog, which extends until 2016. The company’s earnings before interest, taxes, depreciation and amortization have grown from $2.4 million in 2004 to $5.9 million last year. DTRI’s senior management team will remain with the company.
DTRI provides professional services in the areas of program management, acquisition support, operations analysis, systems engineering and integration. QinetiQ says that DTRI provides end-to-end operational support tied to the mission success of its customers.
Under teams of the deal, QinetiQ will pay $123 million for DTRI and two additional $21 million in differed payments to be made on the first and second anniversaries of the completion date. QinetiQ expects to realize $60.5 million in cash benefits for the first two to three years after the transaction, excluding acquisition costs. The deal is expected to close early next month.
BB&T Capital Markets served as DTRI’s financial adviser.