Wyle microbiologist Cherie Ombre prepares a sample of water for testing at the Molecular Biology Lab in the Neil Armstrong Operations and Checkout Building at NASA's Kennedy Space Center in Florida. Credits: NASA/Kim Shiflett

WASHINGTON — NASA contractor Wyle is being acquired by Houston-based KBR Inc. under a deal announced May 23.

KBR, a construction and engineering firm well known for its oil industry work, is paying $570 million for Wyle, a Top 25 NASA contractor that currently holds the agency’s $1.5 billion space medicine contract.

Wyle also provides specialized engineering, scientific and technical services to the U.S. Department of Defense and other government agencies.

KBR President and CEO Stuart Bradie said acquiring Wyle ”creates the equivalent of a global $2 billion Government Services organization with full service capabilities drawing on the best in class capabilities of both organizations.”

Wyle, which is also based in Houston, will become a KBR business unit within KBR’s Government Services segment and will maintain much of its current structure, according to a KBR press release announcing the deal.

“Wyle comes with a significant base of personnel that hold security clearances,” Bradie said during a teleconference following the announcement. “This is often a restriction to growth but also a barrier to entry. It gives access to new sources of U.S government funding. Business comes with solid financial returns, high-end margins and reduced risk via long-term and it’s 97-percent reimbursable.”

Wyle has 3,800 employees and had funded contract backlog of $440 million at of the end of 2015 plus an additional $1.1 billion in orders not yet funded, according to KBR.

“This is a highly strategic acquisition for KBR that transforms our government services business and it provides KBR’s [Government Services] franchise with high-volume technical services, high-level of consulting and testing capabilities in a growing global market for U.S. government clients,” Bradie said during the teleconference.

KBR expects the deal to close by Oct. 1, the start of the U.S. government’s new fiscal year.

SpaceNews intern Patrick Ingraham contributed to this report. 

Brian Berger is editor in chief of SpaceNews.com and the SpaceNews magazine. He joined SpaceNews.com in 1998, spending his first decade with the publication covering NASA. His reporting on the 2003 Space Shuttle Columbia accident was...