General Dynamics to Buy Firm

Defense contractor General Dynamics Corp. moved to bolster its presence in the information technology market, announcing plans Wednesday to acquire Anteon International Corp. of Fairfax, Va., for $2.1 billion.

Under the deal, General Dynamics would pay $55.50 in cash for each Anteon share, a 36% premium over Anteon’s closing price Tuesday of $40.77. The overall deal is valued at $2.2 billion, including the assumption of $100 million of debt.

Anteon shares rose $13.25, or 33%, to $54.02. General Dynamics shares fell 41 cents to $111.68.

Falls Church-based General Dynamics, which makes nuclear submarines, tanks and command and control systems, said the deal would immediately boost its earnings. It expects to close the acquisition, which still needs approval from Anteon’s shareholders, by the end of the second quarter of 2006. Both companies’ boards of directors have approved the deal.

Anteon has a business backlog of $6.6 billion and expects to bring in $1.72 billion in sales next year. The company designs systems for national defense, intelligence, homeland security and other government needs.

General Dynamics had sales in 2004 of more than $19 billion.

General Dynamics Chief Executive Nicholas Chabraja said Anteon would significantly strengthen the company’s information technology offerings to the defense, intelligence and homeland security sectors.