KBR to acquire NASA contractor SGT
WASHINGTON — KBR, seeking to expand its government services business, particularly with NASA, announced Feb. 23 that it will acquire Stinger Ghaffarian Technologies, Inc. (SGT) for $355 million.
Houston-based KBR said that combining SGT, headquartered in Greenbelt, Maryland, with its KBRwyle subsidiary will help it take advantage of new opportunities it sees in government and commercial space created by the Trump administration’s new policies.
“The Trump administration’s policy on the U.S. regaining leadership in space is exciting for existing and future space business,” Stuart Bradie, president and chief executive of KBR, in an earnings call Feb. 23. He added he also saw “opportunities in the growing commercial space arena.”
“We envisage our future space franchise with the addition of SGT having a NASA arm, a military space arm and a commercial space arm,” he said.
SGT, founded in 1994 by Kam Ghaffarian and Harold Stinger, has about 2,500 employees, who work primarily as contractors at government facilities. The company has several contracts with NASA, supports NOAA’s satellite mission operations and works with other government agencies.
“SGT is a great company with very talented people and is the right fit for us as we continue to grow our Government Services portfolio and position ourselves to expand into new areas in line with our strategy,” Bradie said in a statement.
SGT will become a business unit within KBRwyle, which already does work with NASA, and maintain its current management structure. The companies did not announce any plans for layoffs or other consolidation as a result of the acquisition.
KBR did not announce the value of the deal in its release announcing the acquisition, but in a filing with the U.S. Securities and Exchange Commission stated that it was paying $355 million for SGT. The agreement gives the companies the right to terminate the agreement if it does not close by June 22.
Bradie suggested in the earnings call that SGT approached KBR about selling the company. “It’s like all things in life, sometimes you can’t dictate that timing,” he said when asked about why KBR was buying SGT now. “They were at the time where they felt they had grown to circa $500 million and they needed to do something different to grow the company more.”
SGT is not the only space-related company that one of its co-founders is involved with. Ghaffarian is chairman of Axiom Space, a company that plans to develop commercial space stations. He is also co-founder and chairman of Intuitive Machines, an engineering company that develops spaceflight and autonomous system technologies.