Serco Group Chief Confident SI International Acquisition Is Right Fit at Right Time
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Last week, the North American arm of the Serco Group of Britain closed on its acquisition of Reston-based SI International, a government contractor that services the Department of Defense and other federal agencies.
The deal comes at an uncertain time for government contracting, with a ballooning federal deficit and the change in presidential administrations. An edited version of a conversation with chief executive Edward J. Casey Jr. on those and other issues:
QWhen the merger was announced last summer it was far from clear who would be the next U.S. president. How do you see the Obama administration affecting government contracting?
AYou have to look beyond the campaign rhetoric and look at the situation that would exist. There are going to be, undoubtedly, budget pressures, and I think the Department of Defense will not escape those budgetary pressures. That is just a fact. However, when you look at the fact that there are two wars being waged, if you look at the fact that global political unrest is on the rise, simply the demands on our defense and security organizations are going to remain at very high levels.
So yes, there will be downward pressure on defense budgets, but there are the practical realities of the global, political and economic environment that are going to keep us focused on the areas of defense and national security.
Couldn't the government hire more people to meet those challenges instead of relying on outside contractors?
It is hard to find the right people with the right skills and specialties. Also, there are going to be increasing budget pressures, and to me, what that means is the government is going to be motivated to find improvements in productivity.
Why was SI International such an important acquisition for you?
It complemented our customer base really ideally. I will give you an example: We were strong in Army, Navy, the FAA, and we have a big presence with the Post Office. SI is strong in Air Force, Department of Homeland Security, Department of State and the intelligence world, and so there was literally no overlap between the two customer bases.
How will this merger affect Reston-based employees of SI International?
There is a small number, a very small number compared with the combined workforce, that are redundant -- and those positions will be eliminated. There are probably 30 or 40 more that will be eliminated on top of 40 or 50 already cut.
-- Alejandro Lazo
