Publicly-traded KBR, Inc. has entered into an agreement to acquire Wyle, a portfolio company of Court Square Capital Partners, for $570 million in cash. Court Square acquired Wyle in June 2009 from Littlejohn & Co. which had acquired the company in 2003.
Wyle is a provider of engineering, professional, scientific and technical services primarily to the US federal government including the Department of Defense and NASA. Specific services provided by Wyle include systems engineering, life science research, space medical operations, information technology, and testing and evaluation of aircraft. Wyle has approximately 4,000 employees and annual revenues of $900 million. As of year-end 2015, Wyle’s funded backlog was $440 million with an additional $1.1 billion of orders not yet funded, but expected. The company was founded in 1949 by Frank Wyle and is headquartered in El Segundo, CA (www.wyle.com).
The $570 million purchase price for Wyle will be funded by availability under an existing KBR line of credit and approximately $200 million in cash. The transaction is expected to close by September 2016.
KBR is an engineering, procurement, and construction company with annual revenues of approximately $7 billion. The company is a former a subsidiary of Halliburton and was previously known as Kellogg Brown & Root. KBR is headquartered in Houston (www.kbr.com).
Wyle will become a KBR business unit within KBR’s Government Services segment. According to KBR the acquisition will combine KBR’s strengths in international, large-scale government logistics and support operations with Wyle’s specialized technical services, which are largely focused in the US.
“Adding Wyle’s highly specialized and differentiated offerings to our global government services portfolio improves KBR’s overall risk profile by expanding into other government funding sources for higher-margin and largely cost-reimbursable work,” said Stuart Bradie, President and CEO of KBR. “The acquisition is expected to be accretive in the first year and provide longer term synergistic opportunities in markets where KBR’s large-scale logistics and project management capabilities combine with Wyle’s specialized technical capabilities.”
Court Square Capital Partners invests in middle market companies that are active in the business services, general industrials, healthcare, and technology/telecommunications sectors. Court Square currently manages approximately $5 billion of capital and is based in New York (www.courtsquare.com).
© 2016 Private Equity Professional • Private Equity’s Leading News Magazine • 5-24-16
