Loral to Sell BDM to Carlyle Group for $130 Million

Although its purchase of Ford Aerospace Corp. isn’t yet complete, Loral Corp. said Tuesday that it will sell defense consulting firm BDM International Inc., the largest subsidiary of Ford Aerospace, to the Carlyle Group of Washington for $130 million.

The purchase price is less than a third of the $425 million that Ford Motor Co., parent company of Ford Aerospace, paid for BDM when it acquired the McLean, Va., firm in 1988. Analysts said the sharply lower price for BDM reflects Pentagon spending cuts that have depressed the value of defense-related businesses.

Walter Peterson, an analyst for the Baltimore investment bank Ferris, Baker Watts, said that consulting companies have generally been selling for about 30% of their revenue. Based on that criteria, he said, Loral is getting a premium price for BDM.

The Carlyle Group, along with partner Westinghouse Electric Co., was one of several groups that bid unsuccessfully for all of Ford Aerospace. Carlyle said it will name former Defense Secretary Frank C. Carlucci chairman of BDM.