Apogen acquired by British defense contractor

Continuing a push into the U.S. defense and security market, British defense contractor QinetiQ, will buy Apogen Technologies for $300 million in cash, both companies announced today.

Pending approval from federal regulators, Apogen will be the third major U.S. acquisition in the past year for the defense technology and security company. Last fall, QinetiQ (pronounced "kinetic") acquired St. Louis-based Westar Aerospace and Defense Group and Foster-Miller, an engineering and technology development company based in suburban Boston.

Foster-Miller also announced this week that it will acquire Reston, Va.-based Planning Systems, a high-tech company that provides systems engineering work to the federal government, for $42 million.

Similar to the other two U.S. companies, Apogen will become a wholly owned subsidiary of QinetiQ North American, but it will remain autonomous and retain its name, management team and staff. The acquisition is expected to be completed in September.

Apogen, a private company with 900 employees and $205 million in revenues last year, specializes in enterprise architecture, software development and integration, and building and operating networks in the federal technology and national security sectors. The company was formed when ITS Services and Science and Engineering Associates merged in January 2004.

In a press release, John Chisholm, QinetiQ’s chief executive officer, said the U.S. market is central to his company’s overall growth.

“Our strategy in the U.S. is to penetrate the defense and security markets by creating three operating businesses that reflect our main routes to market – through the provision of groundbreaking technology, systems engineering and customer support, and information technology,” he said.

Apogen's leaders see the acquisition as a way to give their customers access to new products, and as a way to expand into Europe.

“Joining the QinetiQ Group will help us accelerate our growth plans through access to technologies that complement and enhance our current service and solution offerings,” Todd Stottlemyer, Apogen’s chief executive officer, said in a prepared statement.

“Of particular importance to Apogen is QinetiQ’s wide array of technology-based security solutions that we will be able to deploy to help our customers better secure America’s borders, protect their technology infrastructures, deter future terrorist attacks and more effectively meet their important missions,” he added.

Founded in July 2001, QinetiQ is a spinoff of the U.K. Ministry of Defence's research arm. The company posted about $1.5 billion in revenue for the fiscal year ending March 31. It has about 12,000 employees in the United Kingdom and United States.


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