KBR to buy intel and space firm Centauri

KBR has agreed to acquire fellow US engineering company Centauri for about USD800 million in cash, expanding its presence in such fast-growing areas as intelligence and space, KBR announced on 19 August.

The flag of the United States. (Credit: Getty Images)

KBR, which is based in Houston, Texas, said the acquisition will diversify its portfolio, making it more resilient to business downturns, and will give it access to additional customers, including the new US Space Force. Centauri will become part of KBR’s Government Solutions segment, which includes significant cybersecurity and missile defence capabilities but has little overlap with Centauri.

“Quite simply, it’s a great fit,” said Stuart Bradie, KBR’s president and CEO.

Centauri CEO Dave Dzaran, whose company is currently owned by US private equity firm Arlington Capital Partners (ACP), said that becoming part of a larger entity will provide more growth opportunities. Centauri has about 1,750 employees, compared to KBR’s 28,000.

The transaction, which requires US regulatory approval, is expected to close early in the fourth quarter of 2020. KBR plans to fund the purchase with USD300 million in cash and USD500 million in debt.

KBR said Centauri has achieved “significant growth” over the last four years and has a “substantial and growing pipeline of opportunities” for US defence and intelligence contracts. Centauri is expected to generate revenue of more than USD700 million in 2021.

Byron Bright, president of KBR’s Government Solutions segment, said Centaur focuses on technologically complex, often classified work across three business lines: Space Superiority & Missile Defense, which integrates optics, radars, and electronic warfare with new technologies; Space and ISR Engineering, which supports operations of the US National Reconnaissance Office (NRO); and Intel, Electronic Warfare and Cyber, which supports multiple other intelligence agencies.