General Dynamics to buy IT contractor CSRA in $6.8 billion deal
FALLS CHURCH, Va. General Dynamics announced that it has entered into a definitive agreement with IT contractor CSRA under which General Dynamics will acquire all outstanding shares of CSRA; the transaction is valued at $9.6 billion, including the assumption of $2.8 billion in CSRA debt.
The deal will fold CSRA -- formed several years ago when Computer Sciences Corp. merged its federal arm with SRA International Inc. -- into General Dynamics’ information systems and technology business, its largest unit, which provides combat software and combat-ready computing equipment.
“The acquisition of CSRA represents a significant strategic step in expanding the capabilities and customer base of GDIT,” said Phebe Novakovic, chairman and chief executive officer of General Dynamics. “CSRA’s management team has created an outstanding provider of innovative, next-generation IT solutions with industry-leading margins. We see substantial opportunities to provide cost-effective IT solutions and services to the Department of Defense, the intelligence community, and federal civilian agencies. The combination enables GDIT to grow revenue and profits at an accelerated rate. It will allow us to deliver even more innovative, leading-edge solutions to our customers.”
According to information from General Dynamics, the company expects the deal to close in the first half of 2018, increase earnings, and generate annual pretax cost savings of about 2 percent of the combined company’s revenue by 2020.