CACI wants to buy CSRA, offering larger bid than General Dynamics

By John Liang  / March 19, 2018

(Editor's Note: This story has been updated with more information regarding General Dynamics' stock bid offer.)

CACI International has thrown its hat into the ring in the chase to purchase CSRA, offering more money per share than General Dynamics’ multibillion-dollar bid.

General Dynamics announced in February it planned to acquire CSRA in a deal valued at $9.6 billion. That deal included an offer to buy all of CSRA’s stocks for $40.75 per share.

However, CACI on Sunday countered GD’s proposal with one of its own, offering to buy CSRA’s stock for $44.00 per share, or 8 percent more.

"The acquisition of CSRA by CACI would unite two businesses with long-term customer relationships, complementary capabilities and substantial presence in high-growth markets," a March 18 CACI statement reads. "Bringing together CACI's mission solutions and services with CSRA's broad range of next-generation enterprise capabilities would create a company able to provide customers with solutions that link domain and mission knowledge with industry-leading enterprise support offerings. The combination with CSRA would further capitalize on this opportunity for growth, amplifying both CACI's and CSRA’s position in key market areas and improving the value proposition and customer footprint."

In a separate statement, CSRA "confirmed" it had received CACI's proposal and said its board, "in consultation with its legal and financial advisers, will carefully review and consider the proposal."

In a statement of its own issued the same day, General Dynamics defended its $40.75-per-share bid, saying the company "continues to believe that this combination creates a premier provider of high-tech IT solutions to the Government Technology Services market and that its proposed acquisition of CSRA offers superior value for CSRA’s shareholders."

UPDATE: On March 20, General Dynamics announced it would increase the price it would pay for CSRA's stock to $41.25 per share in cash, upping the value of the deal to $9.7 billion, including the assumption of $2.8 billion in CSRA debt.

"In connection with the amended merger agreement, CSRA's Board of Directors determined that the previously announced unsolicited proposal from CACI International, Inc to acquire CSRA could not reasonably be expected to lead to a Company Superior Proposal (as defined in the merger agreement)," a GD statement reads. "In reaching that determination, CSRA's Board of Directors took into account various factors, including among others, the value, certainty of value, certainty of closing and speed to closing of the General Dynamics offer, as amended, as compared to the CACI proposal. CSRA's Board of Directors recommends that CSRA stockholders tender their shares of CSRA common stock pursuant to the General Dynamics tender offer."