QinetiQ
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| QinetiQ | |
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| Type | Public (LSE: QQ.) |
|---|---|
| Founded | 2001 |
| Headquarters | UK and North America. Head Office - Farnborough, Hampshire |
| Key people | Sir John Chisholm, Chairman Graham Love, CEO |
| Industry | Security and Defence industry |
| Products | Security and Defence |
| Revenue | $1.45 billion (2004) |
| Employees | 10,000 (2005) |
| Slogan | "The Global Defence and Security Experts" |
| Website | www.QinetiQ.com |
QinetiQ (LSE: QQ.) (pronounced kĭ-nĕt'ĭk, as in kinetic energy) is a British defence technology company, formed from the greater part of the former government agency DERA when it was split up in June 2001 (with the smaller part becoming Dstl). The Chief Executive at inception was the present day Chairman Sir John Chisholm. The current CEO is Graham Love. As a privatised company, QinetiQ is now one of the largest defence research organisations in the world.
QinetiQ solves defence and security problems at the leading edge of both the development and application of science and technology. For example, it made the semi-intelligent ultrasound scuba diver detector called Cerberus. The defence research sites that now form QinetiQ were previously involved in the invention of liquid crystal displays, the technology for one type of flat panel speakers, microwave radar, Chobham armour, and thermal imagers. In recent years QinetiQ has also developed software products, especially those for the defence and security industries.
QinetiQ has a long term agreement (25 years) with the Ministry of Defence to manage military ranges. It is a major stakeholder in the UK Defence Technology Centre which place military research contracts on behalf of the UK Ministry of Defence.
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[edit] Current organisation
Since April 2005 the QinetiQ group has been split into three major divisions:
- Defence and Technology,
- Security and Dual Use,
- North America - contains the North American acquisitions listed below.
The major UK sites are at Farnborough, Hampshire (the historical Royal Aircraft Establishment) and Malvern, Worcestershire (the historical RSRE/RRE/TRE), each having more than 2,000 employees. Trials aircraft are flown out of Boscombe Down. The total number of UK employees is believed to be around 9,000 (figures as of April 2005).
[edit] History
When Defence Minister Lewis Moonie announced the creation of QinetiQ in 2001, he said that it would remain a British company, based in the UK. The Ministry of Defence would keep a 'Special Share' in the company, and safeguards would be in place to prevent conflicts of interest. In February 2003, the U.S. private equity firm the Carlyle Group acquired a 33.8% share in the company for £42m. Prior to stock market flotation, ownership was split between the MOD (56%), Carlyle Group (31%) and staff (13%). The Carlyle Group was expected to invest for three to five years, after which a stock exchange float would take place.
[edit] Stock Exchange listing
QinetiQ was floated on the London Stock Exchange in February 2006. The company had been valued at between £1.1bn and £1.3bn, with the MOD holding estimated to be worth £616m - £728m, the Carlyle Group's holding £341m - £403m, and staff/management's holding worth £143m - £169m. Some controversy was generated by the very large likely returns for the Carlyle Group and senior managers, with figures of over £20m suggested in the media for Sir John Chisholm.
Financial press speculation concerning a stock exchange float increased in January 2006. On January 12 an announcement was made in parliament by Dr John Reid, Secretary of State for Defence. He said that the Carlyle Group, 'will continue to retain a significant stake in the company', and that the British government would continue to hold a 'Golden Share' in QinetiQ to protect the United Kingdom's security and defence interests.
Controversy also arose around the fact that retail investors were to be excluded from the Initial Public Offering (IPO) due to QinetiQ's complexity and the fact that institutional investors would require less complicated marketing and financing. This led to contrasts with the 'Sid' campaign for British Gas plc in 1986, where retail investors were encouraged to buy shares, both with discounts and a large advertising campaign. The issue was partially resolved by allowing some brokerage firms to place orders in the IPO as part of a combined order, allowing the firm to purchase as though an institutional investor, but on behalf of clients. While this did not result in a public campaign or retail investor discounts, it did allow many investors to purchase shares directly in the IPO.
The company floated on 10 February 2006, with an IPO of 200p per share, which gave QinetiQ an initial market value of £1.3bn. On 13 February 2006 (the Monday after the Friday IPO) QinetiQ shares closed at 219.5p per share, valuing the company at over £1.4bn. However, by late March 2006 QinetiQ shares dropped 15% from that peak (7% from the IPO price) to 186p each.
Speculation that a consortium including QinetiQ may be about to win a £10b MoD training contract helped push their share price back above 190p in early Nov 2006. [1]
[edit] Company growth
[edit] Acquisitions
In September 2004 QinetiQ acquired the U.S. defence companies Westar and Foster-Miller (maker of the Talon robot).
In early August 2005 QinetiQ announced that it would acquire Apogen Technologies, Inc., pending regulatory approval. The QinetiQ website lists this merger as costing $288.0m (£162.7m).
In September 2005 QinetiQ acquired a 90% share of Verhaert Design and Development NV (VDD), the leading Belgian space systems integrator.
In October 2005 QinetiQ acquired Broadreach Networks Limited, a leading supplier of Wi-Fi internet to the European rail industry.
In February 2006 QinetiQ acquired Graphics Research Corporation Ltd, developer of the Paramarine software suite of ship and submarine design tools.
[edit] Recruitment
QinetiQ is one of the UK's largest employers of science and engineering graduates - recruiting around 300 a year. Since 2002 it has appeared in the Times Top 100 Graduate Employers list.
In September 2005 Graham Love replaced Sir John Chisholm as Chief Executive. John Chisholm became Executive Chairman; the previous chairman Dame Pauline Neville-Jones having resigned earlier in the year.
In October 2006, ex-CIA Director George Tenet joined QinetiQ as an independent non-executive director. [2]
[edit] See also
- Mercator (Unmanned Aerial Vehicles)
- QinetiQ 1 (balloon)
- RV Triton (trimaran vessel formerly owned by QinetiQ)
- Railgun
- Scramjet
