Leidos has agreed to acquire ENTRUST Solutions Group from Kohlberg for about $2.4 billion, expanding its utility and energy infrastructure engineering business nationwide.
The deal will effectively double the size of Leidos’ energy infrastructure engineering business, which generates about $600 million in annual revenue. Leidos has provided engineering services to commercial electric utilities for over two decades, mainly focused on transmission and distribution.
ENTRUST brings engineering expertise across the full power delivery spectrum, from generation through transmission and distribution, serving both electric and gas utilities. The acquisition broadens Leidos’ utility customer base and strengthens its ability to deliver end-to-end engineering solutions.
“ENTRUST’s engineering capabilities and customer base perfectly complement ours, and it has a consistent track record of growth and strong profitability,” said Leidos CEO Tom Bell. “This deal is a bold step forward in support of Leidos’ growth strategy and a national priority to expand America’s energy infrastructure, while improving reliability and resilience against aging systems and extreme weather events.”
U.S. utilities are projected to invest about $1 trillion over the next decade to modernize aging infrastructure, meet growing power demand and strengthen the electrical grid.
The transaction is expected to be immediately accretive to Leidos’ revenue growth and adjusted EBITDA margin and accretive to non-GAAP diluted earnings per share in 2027. Leidos expects to fund the all-cash acquisition through a combination of new debt, cash on hand and commercial paper.
“By joining Leidos, we’re uniting world-class power and energy engineering expertise to create a leading end-to-end infrastructure platform,” said Adam Biggam, CEO at ENTRUST. “Our combined 5,500+ energy professionals will have the resources, technology and reach to tackle the most complex challenges facing the utility and power markets today.”