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Northrop Grumman Corporation (NOC) completed the sale of its business unit TASC, Inc. for $1.65 billion in cash to an investor group led by General Atlantic LLC and affiliates of Kohlberg Kravis Roberts & Co. L.P. The business unit was part of the Information Systems segment. TASC provides information operations and security; intelligence, surveillance, and reconnaissance; and information management solutions.

Northrop Grumman’s Information Systems business segment is a leading global provider of advanced solutions for the Department of Defense, national intelligence, federal, civilian, state and local agencies, and commercial customers. Products and services from this business segment are focused on the fields of command, control, communications, computers and intelligence, missile and air defense, airborne reconnaissance, intelligence processing, decision support systems, information technology systems engineering and systems integration.

The sale of the business unit boosted the liquidity position of Northrop Grumman. The company ended the recent quarter with cash and cash equivalents of $1.9 billion compared to $1.5 billion after year-end 2008. Northrop Grumman’s strong balance sheet and cash flows provide substantial financial flexibility and cushion in matters of incremental dividend, ongoing share repurchase and earnings accretive acquisitions. The company ended the third quarter of fiscal 2009, with a low debt-to-capitalization of 21.5% and total long-term debt of $4.2 billion.

Northrop Grumman’s future success in the competitive defense industry depends upon its ability to develop and market its defense-related products and services to the U.S. Government. The company mainly competes with Force Protection Inc. (FRPT), General Dynamics Corporation (GD) and Boeing Company (BA).

Based in Los Angeles, California, Northrop Grumman provides products, services and solutions in information and services, aerospace, electronics and shipbuilding to the military, government and commercial customers of United States and beyond. The company is the largest information technology service provider to the federal government.

Source: Northrop Sells Business Unit, TASC Inc.