Lockheed Martin Corporation, the world's largest defense company, yesterday said it is selling its risk and resource management business Enterprise Integration Group (EIG) to Veritas Capital Inc for $815 million in cash.
EIG, based in Valley Forge, Pennsylvania, provides systems engineering and integration services. The company has about 1,800 employees and had revenues of $626 million last year.
Maryland-based Lockheed had announced on 2 June 2010 that it plans to divest EIG and Pacific Architects & Engineers (PAE) since the US Government had raised concerns about perceived organisational conflicts of interest between EIG's military and intelligence consulting work and Lockheed, which is a supplier of defense equipments.
The Pentagon has tightened rules on equipment purchases by eliminating potential conflicts of interest since some defence companies were advising the government on what equipment to buy and also bidding for them later.
EIG provides system engineering services, architecture, and integration services and support to a broad range of government customers. Lockheed Martin says divesting the business would position it for better growth.
''The decision to divest EIG followed a comprehensive review of our portfolio to find ways to continuously provide the best, most affordable solutions for our customers, a secure future for our employees and value for our shareholders,'' said Lockheed Martin chairman and CEO Robert Stevens.