Defense technology firm Leidos announced Wednesday it closed a $300 million acquisition of Kudu Dynamics, a company that develops AI-enabled cyber capabilities.
The finalized deal comes as Leidos is implementing a new “NorthStar” strategy that identifies cyber as one of five primary growth areas for the company.
“Kudu’s ability to generate new cyber capabilities with AI perfectly complements our strategy to rapidly grow differentiated offensive cyber technology capabilities,” Leidos CEO Tom Bell said in a statement. “This acquisition underlines Leidos’s commitment to continue to build smarter full-spectrum cyber capabilities, so that the U.S. and its allies dominate the cyber warfighting domain.”
Kudu has around 170 employees and is based in Chantilly, Virginia. The firm has customers in the Defense Department and the intelligence community.
Roy Stevens, president of Leidos’ national security sector, told Defense News the firm was particularly drawn to Kudu’s expertise in identifying cyber vulnerabilities, developing code that can exploit flaws in a system and then create an electronic-warfare or other effect.
He specifically highlighted the firm’s application of AI to exploit an adversary system.
“We really believe warfare is moving more and more in that direction,” Stevens said. “That’s a place where they have a unique position.”
Those strengths, he said, directly align with the opportunities and gaps Leidos has identified within its own cyber portfolio, and the company expects the acquisition will help it get after its growth targets 18 months faster than it may have otherwise.
Leidos today has a large defensive and offensive cyber footprint and provides support to DOD and intelligence customers, including the National Security Agency. The company in April won a $390 million contract to provide signals intelligence to the NSA, and last June the Air Force and Space Force re-upped their enterprise IT contract with a $738 million award to Leidos.
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