PAE announced on Monday that the company has entered into a definitive agreement to acquire CENTRA Technology, an intelligence analysis service provider focused on providing mission-critical services, for approximately $208 million in cash. The acquisition will specifically strengthen PAE's intelligence, defense, and national and homeland security businesses.
“The acquisition firmly aligns with PAE's strategy of expanding the business to higher-margin market areas. By acquiring CENTRA, PAE realizes a significant milestone in the execution of our strategic growth plan to be a provider of innovative, higher margin, knowledge-based offerings in attractive, resilient end markets,“ said PAE President and CEO John Heller, who is also a five-time Wash100 Award recipient.
More specifically, the move will expand and differentiate PAE's capabilities in intelligence analysis, communication systems integration and research and development services for intelligence and defense customers. CENTRA's business will also broaden PAE's customer reach and add attractive contract vehicles to the company's portfolio.
This exciting opportunity builds on our intelligence analysis capabilities while increasing customer access, accelerating growth and enhancing shareholder value. Additionally, the acquisition of CENTRA is expected to be accretive to adjusted EBITDA margins and free cash flow,“ Heller added.
The transaction was unanimously approved by the boards of directors of PAE and CENTRA. The acquisition will close in the fourth quarter of 2020. Morgan, Lewis & Bockius LLP acted as legal advisor and Renaissance Strategic Advisors, LLC acted as strategic advisor to PAE in connection with the transaction.
“This transaction will further enhance CENTRA's capabilities and create new opportunities for our customers and employees,” said Jack Barry, COO of CENTRA Technology. “The customers, contracts and offerings of each business complement each other well and will be attractive for all stakeholders.”