Serco Share News (SRP)

(Sharecast News) - Public services firm Serco has agreed to acquire Northrop Grumman's mission training and satellite ground network communications software business for $327.0m in cash.

Serco said on Thursday that the business, which provides the US military with advanced mission training services and software for satellite ground networks, will build additional scale for the company in North America, growing revenues beyond $2.0bn and pushing profits above $200.0m.

The FTSE 250-listed firm also said the acquisition brought new capabilities and access to a broader base of customers, which will provide further opportunities for it to grow organically in both North America and internationally.

Chief executive Mark Irwin said: "We have approximately doubled revenue and more than trebled profit in Serco's North America business in recent years through a successful combination of organic growth and strategic acquisitions. MT&S provides an excellent opportunity to continue that success.

"The acquisition increases our scale, capabilities and growth potential in US defence, the largest defence market in the world, as well as providing solutions we can offer to our customers worldwide."

As of 0850 GMT, Serco shares were up 3.98% at 156.60p.

Reporting by Iain Gilbert at Sharecast.com