In a strategic move to capture growth in the critical energy infrastructure sector, technology services provider Leidos has announced a definitive agreement to acquire ENTRUST Solutions Group. The all-cash transaction, valued at approximately $2.4 billion, is poised to significantly expand the company’s engineering footprint.
Targeting Grid Modernization and AI-Driven Demand
The acquisition is a direct response to two converging market forces: the urgent need for utility grid modernization and the surging power requirements of artificial intelligence data centers. By integrating ENTRUST, Leidos will gain deep expertise in planning transmission and distribution networks for power and gas utilities. This positions the company to offer comprehensive infrastructure solutions as pressure mounts on energy providers to upgrade their systems.
This strategic expansion builds upon a foundation of consistent performance. Leidos’s existing energy infrastructure segment has delivered double-digit growth rates and stable margins for the past eight consecutive years. The addition of ENTRUST is expected to accelerate this trajectory and substantially widen the customer base among large utility companies.
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Financial Details and Integration Timeline
From a financial perspective, the deal will effectively double Leidos’s current engineering business in this sector, which stands at around $600 million. Management anticipates the transaction will have an immediate positive impact on revenue growth and EBITDA margin. A accretive effect on earnings per share is projected for the fiscal year 2027.
To finance the purchase, Leidos has secured a $1.4 billion bridge financing facility from Citigroup. The companies expect to close the transaction in the second quarter of 2026.
Strategic Context and Forthcoming Details
This acquisition aligns with a broader strategic focus on high-growth technology areas. Notably, in early January, Leidos announced a collaboration with OpenAI to implement generative artificial intelligence within government and defense processes. The company’s leadership is scheduled to provide further details on the ENTRUST integration during its annual earnings conference call for fiscal year 2025, which will be held on February 17, 2026.
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