With its rich mix of military and government contracts, BBN appears to be a perfect fit for Raytheon, whose $23 billion in revenues are dominated by defense and government business.
"We expect all of our businesses to benefit from the application of BBN's research and development expertise and technologies across our product lines and programs," said William H. Swanson, Raytheon's chairman and chief executive officer, in a statement. "BBN's rich technology heritage makes this a natural fit."
The deal's financial figures weren't revealed, but Raytheon said the acquisition isn't expected to "materially impact" revenue or earnings for the fourth quarter. The acquisition should be accretive to Raytheon's financial statements in 2010, Raytheon said.
In recent years BBN bounced around, first being acquired by GTE in 1997, which was itself acquired by Bell Atlantic. The latter firm merged to become Verizon in 2000, but some BBN networking assets were spun off as Genuity. In 2004, BBN assets were acquired by venture capital firms Accel Partners and General Catalyst Partners.
Earlier this summer, David Fialkow, managing director of General Catalyst Partners, indicated that the investors' strategy of keeping BBN management intact was successful.
Robert G. Elmer, president and CEO of BBN, hailed the acquisition by Raytheon saying it will act "as a multiplier on our proven ability to deliver advances to the market rapidly and profitably and better serve our ultimate client, the U. S. warfighter."
In recent months, BBN has landed important defense contracts including a $14 million pact in July from its long-time government research partner, the Defense Advanced Research Projects Agency (DARPA), for language translation technology. Other recent important contracts include advanced networking, information technologies, sensor systems, and cybersecurity.
BBN, which traces its roots to MIT, was founded in 1948 by Leo Beranek, Richard Bolt, and Robert Newman. The firm played an instrumental role in the development of packet switching and the Internet, setting up its first Arpanet node at its Cambridge, Massachusetts, facilities in 1970. The first person-to-person network e-mail and the use of the @ sign was also carried out at BBN.
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