SI stockholders OK sale to Serco

Serco Group plc's planned acquisition of SI International Inc. took another step toward completion Nov. 12 when SI International's stockholders approved the merger.

Approval by SI International's stockholders was a condition to completing the proposed acquisition.

Serco announced on Aug. 27 that it had signed a definitive agreement to acquire SI International and that the transaction had been approved by both boards of directors.

The deal was a cash transaction worth $423 million.

Serco, the U.S. division of the British Serco Group, is also assuming about $87.3 million in SI's debt. The purchase price was a 40 percent premium over SI's Aug. 26 closing price of $22.89 per share.

Based on 2007 data, the combined companies have $1.3 billion in revenue and 11,500 employees. Virtually all the revenue comes from work with the federal government.

The SI deal is Serco's second major acquisition in three years. In 2005, the company acquired defense contractor Resource Consultants Inc.

The SI acquisition is expected to be completed before the end of the year, Serco officials said. The closing remains conditional upon regulatory approvals and customary closing conditions.

SI International, of Reston, Va., ranks No. 44 on Washington Technology's 2008 Top 100 list of the largest federal government prime contractors. Serco, of Vienna, Va., ranks No. 56.