QinetiQ increases presence in the US Intelligence Community with DTRI acquisition

(19/08/2008)

QinetiQ Group plc has agreed to acquire Dominion Technology Resources, Inc. (DTRI), a leading provider of high end products and services to the US Intelligence Community. DTRI’s expertise focuses on mission architecture engineering, integration and operations support.

Under the terms of the agreement, which is conditional upon regulatory clearance in the United States, QinetiQ will acquire 100% of the stock of DTRI for a net cash consideration of approximately $104.5m (post tax attributes of the transaction). The acquisition will be organised under the Mission Solutions Group of QinetiQ North America (‘QNA’).

This acquisition provides QNA with:
- A significant increase in QNA’s presence in the US Intelligence Community enhancing its existing presence through DTRI’s established relationships and proven performance with classified Intelligence Community customers;
- An exceptionally skilled senior management team who will remain moving forward and a team of more than 100 experienced and skilled employees, virtually all of whom have high level security clearances. The founders will remain with QNA in a senior advisory role;
- Significant opportunity to leverage capabilities, customer relationships, reputation and domain experience to increase QNA’s prominence as an industrial partner to the US Intelligence Community;
- Strong history of growth and profitability with 55% compound revenue growth from $12.4m in 2004 to $46.6m in 2007 and 35% compound EBITDA growth from $2.4m in 2004 to $5.9m in 2007;
- Strong visibility to future revenues under long term contract awards, $397m of backlog through to 2016 as at 31 December 2007 and;
- A business well positioned to continue substantial year on year growth.

Commenting on the acquisition, QinetiQ's chief executive officer Graham Love said: 'We are delighted to be joining forces with a high quality business like DTRI. We look forward to welcoming their employees into QinetiQ and working with the existing management team to grow the business substantially in the future. DTRI operates in an important, fast growing market which is typically difficult to enter. Very importantly, DTRI brings new customer relationships from within the US Intelligence Community and provides us with further growth opportunities within the broader North American market.'

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