By Dana Hedgpeth
Washington Post Staff Writer
Friday, March 5, 2010; A14
Dulles-based Orbital Sciences said Thursday that it will pay $55 million in cash to buy a satellite subsidiary of Falls Church-based General Dynamics.
Orbital, a space technology company with roughly 3,500 employees -- including about 1,600 at its Dulles campus -- agreed to acquire GD Advanced Information Systems, a spacecraft unit that specializes in medium-class satellites. General Dynamics' satellite unit is based in a 135,000-square-foot engineering and manufacturing facility in Gilbert, Ariz., about 10 miles from a facility operated by Orbital in Chandler, Ariz.
The deal is expected to add about 325 employees to Orbital and is scheduled to close in about four weeks.
Defense industry analysts said the deal would make Orbital more of a player in the national security satellite market. The company has done work for the Defense Department, but adding the General Dynamics satellite subsidiary will expand its ability to offer small satellites to other defense and intelligence agencies, as well as NASA and NOAA. Orbital estimates that its sales will be about $1.2 billion this year.
"This positions us to be more competitive in markets that we are already in today or have been aspiring to enter in the future," said Barron Beneski, a spokesman for Orbital. "They've done work for customers we would like to do work for but have not yet. It brings us a set of customer relationships that we'd have to build over time."
Jim McAleese, a defense industry analyst, said the acquisition gives Orbital a leg up on getting more work for the Pentagon.
"They're clearly trying to target doing work for the Defense Department and the intelligence world," he said. "This would be would be a positive of them putting their money where they've said they wanted to grow."