Britain’s Serco plc on Tuesday said its U.S. defense business has agreed to acquire Northern Virginia-based Whitney, Bradley & Brown (WBB) for $295 million in a deal that adds new capabilities in high-end technologies and customers, particularly in the area of acquisition and program management.
The deal also expands Serco’s presence in the U.S. defense market, one of the company’s strategic objectives.
WBB, which provides consulting services mainly to the Defense Department, will add $213 million in sales to Serco, Inc., bringing overall U.S. defense sales for the company to about $1.2 billion. Serco, Inc., does another $500 million in business with federal civilian agencies.
WBB has about 1,000 employees, 80 percent of whom have security clearances, and has capabilities in artificial intelligence, machine learning, data analytics and cyber security, all “priority investment areas for Serco’s clients,” a Serco spokesman told Defense Daily. He added that the deal means Serco can provide “new disciplines” in war gaming, modeling and simulation, and other areas “that are natural extensions of our current work,” and enable the company to better serve customers from design, sourcing and procurement to modernization, logistics and sustainment.
“By establishing a position at the front end of critical platforms, we can establish franchises that stretch over multiple decades,” he said.
Serco has worked for years with WBB and the deal will expand relationships with key customers while doubling its business with the Air Force, Space Force and Army. It also adds some new Navy customers.
“Serco has enjoyed a relationship with WBB for many years working side by side on numerous defense programs,” Save Dacquino, chairman and CEO of Serco, Inc., said in a statement. “This acquisition aligns with our strategy to expand our scope of services with the Air Force, Army, Missile Defense Agency, Office of the Secretary of Defense, and other key accounts. WBB brings a physical presence and established customer relationships at strategic locations that fit Serco’s service offering. Their expertise in weapons modernization, including cyber security, improved sensors, machine learning, and tactical networking, is highly complementary to our existing work for the U.S. Navy and other DoD customers. We view this as a growth-oriented acquisition and look forward to welcoming the outstanding team of professionals that they have assembled.”
WBB also has core capabilities in acquisition and program management, which has been a growth driver for Serco the past few years. The spokesman said Serco’s customers here include the Army, Navy, Space Force, intelligence community, and Federal Emergency Management Agency, and that WBB will add Air Force program offices, the Office of the Secretary of Defense, the Missile Defense Agency, Space Missile Defense Command, the Secret Service and others, all of which are difficult to “enter organically.”
Once the acquisition is completed, Serco will have about $100 million in annual business with both the Army and Air Force/Space Force.
WBB also has a “strong presence” in Huntsville, Ala., filling a key gap for Serco, the spokesman said.
Robert Olsen, CEO of WBB, will serve as a senior vice president of the new Serco business unit.
WBB is a portfolio company of the private equity firm H.I.G. Capital. The deal is expected to close during second quarter.
The pending acquisition of WBB is the first for Serco, Inc., in the U.S. since it acquired the Naval Systems Business Unit of Alion Science and Technology in 2019. That deal increased the size of Serco, Inc.’s U.S. Navy work by 70 percent.
Serco said the deal will be immediately accretive to its margins and earnings per share.