DOD sorting out defense industry

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A Defense Department policy development office is seeking vendors to help assess the financial dimensions of corporate mergers and acquisitions in the defense industry.

The Industrial Base Transformation (IBT) directorate in the Office of the Deputy Undersecretary of Defense for Industrial Policy issued the sources sought notice July 2, and responses are due by July 9. The notice is limited to small businesses.

The contract requires the vendor to perform assessments working with IBT staff, "addressing both the financial health of the target firm as an ongoing concern, and the effect of the acquisition on the financial condition of the buyer, in the context of the broader defense market."

A primary responsibility of the directorate is to participate in DOD policy development and decisions regarding mergers, acquisitions and other corporate relationships among defense suppliers. This is because the companies have substantial impact on the overall structure and technological innovation of the defense industry at all levels of the supply chain.

Jeannette Jordan, a contracting specialist at the Defense Contracting Command-Washington, said mergers or acquisitions are not pre-selected, and they will be selected for assessment as they occur during the contract period.

"The overall goal is to understand the financial dimensions and implications of transactions, focusing on the impact on the financial position of the buying firm and the health of the target firm as an ongoing concern," Jordan said. "Financial assessment is just one of many lines of inquiry performed by DOD in accomplishing statutory review of corporate transaction, and for understanding the condition of the defense industrial base."

The contract's value will be determined based on the proposals received and it will be awarded "as soon as possible," she said.