DynCorp shareholders agree to Cerberus acquisition

Merger is expected to be completed by July 7

DynCorp International Inc. shareholders have approved the company’s merger agreement with certain affiliates of Cerberus Capital Management L.P., a private investment firm.

According to the final tally, shareholders of approximately 88 percent of the outstanding shares of DynCorp common stock as of the close of business May 24, 2010, voted to approve the acquisition, a June 30 DynCorp announcement said.

As a result, the company will become a wholly owned subsidiary of Cerberus.

Subject to the satisfaction or waiver of certain conditions in the merger agreement, the company expects to close the merger July 7, according to the statement.

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Companies that provide services in support of preventing and deterring future conflicts will be in high demand, said John Allen, co-head of the defense and government services group at BB&T Capital Markets Windsor Group, in a Washington Technology column.

“Cerberus Capital Management’s acquisition of DynCorp International is indicative of the sustained interest in international peacekeeping, nation-building, and other soft-power activities,” he said.

DynCorp has more than 14,000 employees in the Middle East — and growing quickly — to assist the State Department in police training and counternarcotics operations, provide translators to the Army, and support logistics and base camps, among other services, Bill Loomis, managing director at Stifel Nicolaus, noted in his April 15, 2010, Washington Technology column.

For fiscal 2010, DynCorp expects to generate about 61 percent of its revenues from Iraq and Afghanistan and another 11 percent from work in other Middle Eastern countries, Loomis said.

DynCorp International, of Falls Church, Va., ranks No. 23 on Washington Technology’s 2010 Top 100 list of the largest federal government prime contractors.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

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