BAE's U.S. Chief Quits to Take Over at SAIC

By Emma L. Carew
Washington Post Staff Writer
Tuesday, June 23, 2009; A16

Walt Havenstein is stepping down after two years as chief executive of the Rockville-based U.S. arm of British defense contractor BAE Systems to take that position at fellow contractor Science Applications International Corp.

Retired Marine Gen. Anthony Zinni, former head of the U.S. Central Command, will be interim chief executive and chairman of the board at BAE Systems while the firm searches for a replacement for Havenstein, the company said. Zinni has been a member of the BAE board for five years.

Havenstein's resignation is effective Friday, BAE said. San Diego-based SAIC declined to comment on its chief executive position. Kenneth Dahlberg, 64, chief executive since November 2003, led the company's transition from employee-owned to publicly traded, and grew its revenue to $10.07 billion. SAIC is one of the region's biggest employers, with more than 17,000 workers in the Washington area.

BAE Systems makes defense and security products including Bradley Fighting Vehicles and Mine Resistant Ambush Protected vehicles. The U.S. contracting businesses, which include land, air and sea products as well as security services, accounted for 58 percent of its parent company's $34 billion in sales last year. Havenstein had been with the company 10 years and also served as chief operating officer of the parent company, a position Zinni will fill as well.

Zinni said he wants to "make the transition to the new CEO in the smoothest and most seamless way."

The Pentagon has said it would like to reduce the amount of work done by defense contractors instead of federal employees, and Zinni said BAE plans to adapt to those changes. He also said the company will continue looking at potential mergers or acquisitions and developing work in intelligence and other areas.

The company, like many other contractors, is keeping tabs on the budgeting process, and policy and strategy developments, Zinni said. "This is a crucial time in our history with the national security issues we have out there," he said.

Havenstein was not available to comment on the transition.

While BAE makes combat vehicles and products geared toward military forces, SAIC's work ranges from defense to areas such as public health and energy.

Defense industry consultant Loren Thompson said Havenstein's move to a company with a distinctly different portfolio and Zinni's ascension at BAE Systems are part of a larger shift in leadership across the defense industry.

"With the drawdown in Iraq signaling a leveling off, if not decline, in defense spending, the reorganization of the defense industry seems to have begun," Thompson said.

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