BAE Systems Inc., the U.S. subsidiary of the world’s third-biggest military contractor, will sell services businesses generating $1.5 billion in sales annually so that it can focus almost exclusively on technology. In an understated announcement from the parent company’s London headquarters on Friday, BAE indicated it was reviewing its portfolio of U.S. businesses in response to changing market conditions. The planned sales, in combination with realignment of a geospatial-intelligence business under the company’s electronic sector, will result in one of the U.S. subsidiary’s three major business units disappearing. An under-performing fourth business unit was broken up last year by incoming President & CEO Jerry DeMuro. About 8,000 workers are employed at the businesses likely to be sold, with proceeds from the divestitures expected to bolster BAE’s already formidable technology portfolio. I have written a commentary for Forbes here.
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