Regions Northern Virginia

Providence Equity Partners to acquire SRA International in $1.88 billion deal

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Fairfax-based SRA International Inc., a technology and strategic consulting services company, has agreed to be acquired by an affiliate of Providence, R.I.-based Providence Equity Partners in an all-cash deal worth $1.88 billion.

Under the deal, SRA shareholders will receive $31.25 in cash for each share of common stock, a 10.2 percent premium based on yesterday’s closing price of $28.36.
After the deal is completed, SRA’s headquarters will remain in Fairfax, and existing senior management will continue to lead the company. Dr. Ernest Volgenau, the company founder, will continue as chairman of the SRA board.

The transaction is subject to approval of a majority of SRA’s outstanding shares of SRA, as well as a majority of the outstanding shares of SRA Class A Common Stock (excluding shares beneficially owned by Volgenau), and other customary closing conditions and regulatory approvals.

SRA’s board of directors formed a special committee of independent directors in October to explore the possibility of an acquisition, retaining Houlihan Lokey as its outside financial adviser and Kirkland & Ellis LLP as its special counsel.

“Given published speculations over the past four months, it should be noted that SRA never received, and thus never rejected, an offer at an erroneously reported aggregate value of $2 billion,” the company said in a press release. “Indeed, the only figure ever communicated to SRA from that third party was a December 1, 2010 highly conditioned expression of interest in the range of $30-$31 per share which did not materialize.”

The transaction is expected to close during the first quarter of SRA’s 2012 fiscal year, which begins on July 1. SRA will become a privately held company. Volgenau will roll over a portion of his existing SRA equity interest and continue to be a significant shareholder in the privately held company.



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