HOOK (dpa-AFX) - Serco Group plc (SRP.L), a provider of public services, Thursday announced that it has agreed to acquire Northrop Grumman's mission training and satellite ground network communications software business for $327 million in cash. The deal is expected to conclude by mid-2025.
The business offers advanced training services for the US military and software that improves the efficiency of satellite ground networks. The consideration will be paid with sufficient capacity available through existing cash and debt facilities.
MT&S will help Serco expand in North America, increasing revenue to over $2 billion and profit to $200 million. It also provides new capabilities and access to more customers, creating opportunities for Serco to grow both in North America and globally.
The acquisition helps them grow in the US defense market and offer solutions to customers worldwide. It provides key, technology-based services that support the US military's focus on improving readiness and efficiency.
1,000 new employees from MT&S will join Serco.
The business is expected to generate revenue of around $300 million. And Mid-single digit accretive to underlying EPS in 2026, the first full year of ownership.
And Adds 0.9x to net debt: EBITDA. Leverage within the target range of 1-2x following the transaction and expect to de-lever thereafter.
Wednesday, the stock had closed at $151.74, 1.14 cents higher on the London Stock Exchange.
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