Veritas Capital has reached a deal to acquire the government information technology division from Harris Corp. (NYSE: HRS), a provider of tactical communications and air traffic management. The transaction is valued at $690 million in cash and is expected to close in the second quarter of 2017.
The government IT business, operating under Harris’ Critical Networks segment, provides communications, engineering, and IT services for intelligence, defense and federal civilians. The Herndon, Virginia-based IT business generates more than $1 billion in revenue` each year, and also supports NASA’s Space Communications Network and Deep Space Network programs. Funds from the sale of Harris’ IT business will be used to support the seller’s capital allocation strategy, including: pension pre-funding and share repurchases. The divesture does not include Harris’ air traffic management business, which mainly serves the Federal Aviation Administration.