(Reuters) – The American arms company CACI International Inc. ( CACI.N ) has offered to affiliate with the larger CSRA Inc. ( CSRA.N ) to which Disrupting operation $ 6.8 billion acquisition by General Dynamics Corp. ( GD.N ), people who were familiar with the matter said.
The move comes after CSRA has recently agreed to sell its month to General Dynamics, another armaments corporation, for $ 40.75 a share in cash as companies in the sector seek to do so under the administration of US President Donald Trump to position for an increase in government spending.
CACI's stakes have risen more than a fifth in the last four months, encouraging the Arlington, Virginia-based company to use its currency to make a transformative deal, the three sources said Sunday. CACI has a market capitalization of $ 3.9 billion, compared to $ 6.7 billion for CSRA.
CACI's $ 44 per share for the CSRA offering consists of $ 15 per share in cash and 0.184 CACI shares for each CSRA share, according to one source. Under the terms of the CACI Offer, CSRA Shareholders would, according to the sources, own 55% of the combined company.
The Board of CSRA has yet to respond to CACI's offer, although it remains an all-cash agreement, sources said.
The sources are asked not to be identified, as the deliberations are confidential. CACI, CSRA and General Dynamics did not respond immediately to comments. The Wall Street Journal reported on CSRA's CACI offer for the first time on Sunday.
CSRA provides information technology and related services to the Department of Defense and the intelligence community. General Dynamics hopes the CSRA will help get more out of the recent US defense budget. Under the terms of her contract, CSRA would pay General Dynamics a $ 204 million resolution fee to make a deal with someone else.
CACI has also tried to create economies of scale through dealmaking. In 2016, the company acquired the Government Services Division of L3 Technologies Inc. ( LLL.N ) for $ 550 million in cash. It also made an unsuccessful bid to unite with Lockheed Martin Corps ( LMT.N ) government information technology and services firm.
Recent transactions in this sector include the agreement of the US defense company Northrop Grumman Corp. ( NOC.N ) of last September, Orbital ATK Inc. ( OA.N ) to buy about $ 7.8 billion, an agreement that will give him better access to lucrative government contracts and expand his arsenal of missile defense systems and space rockets.
Mike Stone's coverage in Washington, D.C. and Greg Roumeliotis in New York; Arrangement by Lisa Shumaker