SRA to buy Adroit Systems for $40 million

SRA International Inc. of Fairfax, Va., is acquiring Adroit Systems Inc., a privately held provider of engineering services to defense and intelligence agencies, in a $40 million cash deal.

More than 90 percent of the ASI's business is with the Defense Department and intelligence agencies. ASI, of Alexandria, Va., provides high-end information engineering solutions for command, control, communications, computers, intelligence, surveillance and reconnaissance systems, logistics, knowledge management and intelligence analysis. As of Sept. 30, 2002, the company had approximately 330 employees with about 80 percent holding security clearances. For the year ending Sept. 30, 2002, ASI had $42.8 million in revenue and net income of $2.2 million.

Ernst Volgenau, president and chief executive officer of SRA, said that ASI typifies the type of strategic acquisition his company seeks.

"ASI adds surveillance and reconnaissance capability to our existing defense and intelligence business and allows us to provide a complete C4ISR capability," Volgenau said. "Our customer sets are complementary with very little overlap, offering potential to cross-sell our services."

All of ASI's management team and operating divisions are expected to become part of SRA's Command, Control, Communications and Intelligence business unit.

According to the terms of the agreement, SRA will acquire ASI for $40 million in cash. As part of the transaction, ASI executives will buy approximately 170,000 shares of SRA class A common stock based on an average closing stock price. The stock will be unregistered and restricted by a six-month lockup. Closing of the transaction is subject to approval by ASI's stockholders and other conditions. The transaction is expected to close by early February, and the acquisition will be accretive to earnings in 2003.

SRA provides information technology services and solutions to the federal government in three primary markets: national security, health care and public health, and civil government. The company reported revenue of $361 million in fiscal 2002 and employs 2,100 individuals.