BAE buys US computer group

BAE Systems was today preparing to play a more central role in the war on terror after acquiring a leading IT supplier to the Pentagon.

The aerospace and defence group has agreed a $600m (€489.9m) deal for DigitalNet Holdings, a maker of secure computer networks that can carry sensitive data and intelligence.

BAE said the deal will “enhance its ability to address evolving US national security priorities” and boost earnings within the first year after completion.

Its operations in North America will now generate revenues of more than $1.2bn (€979.7m) from the sale of IT systems to US government agencies.

In addition to the Pentagon, DigitalNet makes secure computer networks for national intelligence agencies and the Departments of Homeland Security, Justice, Treasury and State.

Based in the US state of Virginia and employing 2,200 staff, DigitalNet recorded sales of $292m (€238.4m) in 2003.

But this is dwarfed by the $5bn (€4.1bn) generated by BAE across the Atlantic each year from the sale of technology to the US Government and commercial customers.

Its North American Unit, which employs 26,000 staff, accounts for more than 20% of group revenues and profits.

Last month, it won a place on the final shortlist of firms tasked by the US Department of Homeland Security with developing technology to protect commercial aircraft from missile attack.

Chief executive Mike Turner said: “The acquisition of DigitalNet will be an important step in enhancing the capability of BAE Systems North America to better serve its customers.”