Engility Holdings Inc. is exploring a sale, with both CACI International Inc. and Science Applications International Corp. potentially looking to buy the U.S. defense contractor, Reuters reported on Wednesday.
The sale of Engility, Reuters said, could benefit the company as defense contractors are consolidating in order to offer more attractive bids on bigger projects such as cybersecurity offerings, and refreshing outdated computer systems.
A call and email to CACI was not returned. Engility did not return a call from CRN for comment. SAIC did also not return a call for comment.
Engility stock was up more than 12 percent on Thursday, rising to $35.51 in afternoon trading. CACI's stock price spiked a little more than 1 percent to $179.70, while Science Applications shares were up about 1 percent to $85.10.
In March, public sector powerhouse CACI submitted a $7.2 billion bid to acquire rival solution provider CSRA – a move that would have thwarted U.S. defense contractor General Dynamics' planned purchase of CSRA for $6.8 billion.
CSRA, No. 14 on the 2018 CRN Solution Provider 500, acknowledged receiving an "unsolicited" proposal from CACI to buy all of its outstanding common stock in exchange for a mixture of cash and equity. The offer is worth $44 per share, including cash equivalent to $15 per share and a 0.184 CSRA-CACI equity trade ratio, and would give CSRA stockholders 55 percent ownership of the combined company.
General Dynamics prevailed when it bought CSRA Inc for $9.7 billion, after CACI withdrew its offer.
With a market cap of $1.3 billion, Chantilly, Va.-based Engility provides skilled personnel to the U.S. Department of Defense, Homeland Security and Department of Justice.
Back in late 2015, CACI and Engility Holdings, along with Leidos, were rivals in a bidding war for Lockheed Martin’s government IT business. Engility backed out, and a month later, Lockheed merged its $4.7 billion government IT business with $5 billion powerhouse Leidos, creating the world’s largest pure-play U.S. government solution provider.