Carlyle Group Sells Off EG&G
Division In $500-Million Deal

By Tom Ichniowski

In a move to expand its federal work, URS Corp. has agreed to acquire EG&G Technical Services, in a deal that URS values at $500 million. Under terms of the transaction, announced July 17, EG&G's owner, the Carlyle Group, a Washington, D.C., investment company, will receive $165 million in cash, about $130 million in URS common stock and $40 million in a new series of convertible preferred stock.
If the deal is completed, URS says EG&G stockholders will have about 23% of URS's common stock. URS also will retire about $165 million in EG&G debt.
EG&G would be a wholly owned subsidiary of San Francisco-based URS. George R. Melton, EG&G's president and CEO, would continue as president of the EG&G unit.
The combined companies would have about $3.2 billion in revenue and $90 million in net income, on a pro forma basis. About 40% of the revenue would come from the federal government.
Martin M. Koffel, URS's chairman and CEO, says the acquisition "enhances our presence as a key federal contractor and positions us especially well in the rapidly expanding market for homeland defense services including emergency preparedness, force protection and anti-terrorism projects."
URS says it has financing commitments for $900 million to carry out the deal.
Carlyle's chairman is former Defense Secretary Frank Carlucci; James Baker, former Secretary of State and of the Treasury, is senior counselor.


This Site Served by TheHostPros