John Song, managing director at Baird, discusses CACI’s failed bid to purchase federal I.T. firm CSRA, and what this means for the standing offer from General Dynamics.
Last month, General Dynamics announced it was purchasing I.T. firm CSRA for $40.75 per share. However, over the weekend CACI proposed a counter offer: $44 a share. This offer was quickly rebuffed by CSRA, who are still working towards the General Dynamics deal. Nextgov reports that in the most recent purchase agreement, General Dynamics will now pay 41.25 per share for the firm, valuing it at $9.7 billion. “It was ultimately a risk/reward choice they had to make,” said John Song, managing director at Baird. “So, they had an offer that’s slightly lower with General Dynamics, but it’s an all-cash offer. With CACI, they tried to entice them with a little bit of cash, but also their stock as currency to do the deal. Sort of, trying to sell them on that there’s value creation in the longer term for them to capture together. Unfortunately for CACI, that didn’t pan out the way that they hoped.”
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