DC-based investment firm Carlyle Group is buying defense contractor ManTech in an all-cash deal valued at $4.2 billion, reported Reuters.
ManTech’s information technology and technical services focus on national defense programs for the intelligence community and Department of Defense, primarily analytics and cybersecurity.
The deal was approved by ManTech’s board, which recommended that its shareholders vote in favor of the acquisition. The transaction is expected to close this year, pending approval from ManTech shareholders and government regulators.
Carlyle will benefit from ManTech’s large exposure to intelligence customers and to the cybersecurity sector, Wells Fargo analyst Matthew Akers said.
ManTech’s business could be an attractive addition to the portfolios of other Fed IT companies such as Leidos Holdings, Booz Allen Hamilton Holding, Akers said, adding he would not rule out further bids.
The deal comes when the outlook for mergers and acquisitions in the defense sector has been uncertain after arms maker Lockheed Martin in February terminated its $4.4 billion proposal to acquire rocket engine maker Aerojet Rocketdyne Holdings amid opposition from US antitrust enforcers.
The Biden administration has also released a report detailing recommendations to boost competition in its defense industrial base, saying rapid consolidation has created a national security risk.
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