Leidos to buy Gibbs & Cox in $ 380 million deal
Defense contractor Leidos is making an offer to buy nearly 100-year-old ship design company Gibbs & Cox in a $ 380 million deal, the company said on a earnings call on Tuesday.
The cash deal, expected to close in the second quarter of 2021, would place Leidos in a competitive position in the emerging market for unmanned naval systems that underpins much of the Navy’s strategic direction.
“The acquisition of Gibbs & Cox will expand our existing maritime business and add specific capabilities and services, such as naval architecture and marine engineering, 3D modeling and design and… engineering to the set of solutions we offer our customers, ”said Roger Krone, CEO of Leidos, during the results call.
“We are very excited about the way Gibbs & Cox brings its capabilities around the design of the vessel and the systems of the vessel. And we bring, if you will, the equipment for the mission. And we’re really excited about how that will fuel the growth of our marine business going forward. “
Leidos was involved in some of the Navy’s earliest forays into unmanned surface systems and was the primary contractor in the development of the Sea Hunter unmanned surface vehicle for DARPA moving to the Navy. Leidos lost in July to Sea Hunter subcontractor L3Harris to develop the Navy’s Tracking Medium Unmanned Surface Vehicle (MUSV).
“We learned a lot about the autonomy and the business of the Navy and in our MUSV program, I think we had a very, very competitive offer, but we didn’t win. And as good as we are about outfitting the autonomy mission, I think we’ve learned some things about naval architecture and ship design, ”Krone said.
Gibbs & Cox designed the former Oliver Hazard Perry-class frigate, the Arleigh Burke-class guided missile destroyers and the Freedom-class Littoral combat ship. It also changes the design of the FREMM frigate for the Constellation class of the Navy, which Fincantieri Marinette Marine is building.
In September, Gibbs & Cox was one of six companies to win a $ 7 million design contract to develop a concept for the Navy’s large unmanned surface vessels.
As part of the deal, Leidos is expected to retain the Gibbs & Cox brand identity and operate as a wholly owned subsidiary.
“We can increase [Gibbs & Cox] with thousands of system engineers and engineering tools, digital engineering tools, a larger and more stable track record that can help invest in business development, technical reporting resources, ”said Gerry Fasano, president of the Leidos Defense group. said in an interview on Tuesday with Defense 1.