US defence cuts force sell-off by British firm QinetiQ
BRITISH defence firm QinetiQ has agreed to sell its ailing US division for £128million and will use the proceeds to buy back shares and pay down debt.
QinetiQ, the former research and development arm of the Ministry of Defence, has struggled to make its aggressive expansion pay off after huge cuts to the US defence budget.
QinetiQ first mooted the sale of its US arm last May as the value of the division was written down by £256million.
The division accounted for 36 per cent of QinetiQ’s sales in 2012/13 but posted a 13 per cent fall in first half orders in November.
QinetiQ will receive an initial £98million for its US arm from SI Organisation, which could rise by £30million depending on the division’s profit in the year to March 2015.
The deal excludes Cyveillance, the cyber intelligence operation QinetiQ bought five years ago.
