SAIC executives reassure investors over shutdown woes as $2.5 billion merger sails through

The government services giant Science Applications International Corp. announced last week that it has completed its $2.5 billion acquisition of IT services firm Engility, creating a $6.5 billion-a-year government services giant.

The deal is the latest example of consolidation in the government contracting industry, where midsize and large companies are pursuing mergers and acquisitions in search of greater scale.

In a recent interview, SAIC chief executive Tony Moraco said completion of the merger should mark the emergence of a bolder, less risk-averse SAIC. Folding Engility into the company adds about 6,000 workers to the company’s population of workers with security clearances. Workers with security clearances are particularly important to companies that serve the government, because it often takes more than a year for new employees’ clearances to process.

That added scale should enable SAIC to chase bigger opportunities than it has in the past, possibly opening up new markets within the federal government.

“This allows us within this market to pursue and deliver on larger-scale contracts, predominantly in the space and intelligence markets, as well as mission assurance and spaceflight,” Moraco said. more

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