United States based aerospace and defense company Northrop Grumman Corp. (NOC) will be selling its federal IT and mission support services business to private equity firm Veritas Capital in a deal worth $3.4 billion.
Northrop which is among world’s largest producers of weapons and provider of military technology said the deal will be an all cash one.
The company has 90,000 employees and it intends to use the proceeds from the sale to service its debt portfolio and to buy back shares. As at the end of September Northrop’s long term debt stood at $14.26 billion.
In earlier reports, Northrop had estimated its federal IT and mission support services business to generate revenue of $2.3 billion in 2020. This business will be merged with Veritas owned company Peraton, which provides intelligence and security services to commercial and federal agencies.