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BDM TO ACQUIRE GERMAN COMPANY; LARGEST ACQUISITION IN COMPANY HISTORY

 MCLEAN, Va., June 21 /PRNewswire/ -- BDM International, Inc. (BDM), today announced what President and CEO Philip A. Odeen characterized as "our largest acquisition to date," involving a Germany company currently owned indirectly by the German government, known as IABG (Industrieanlagen-Betriebsgesellschaft).
 The German Ministries of Finance, Defense, and Research and Technology have approved a plan by which BDM will become the majority owner of IABG, which provides analytical, engineering development and testing services to German defense and civil government agencies, as well as to companies in the private sector. Other potential shareholders of IABG, under BDM's plan, are German companies and individuals, among them the current IABG management and employees.
 IABG had 1992 sales of DM 323.7 million (approximately $200 million) and a work force of approximately 1,500. It is headquartered in Ottobrunn, Germany, a suburb of Munich.
 The new IABG will operate as a separate company, continuing to perform programs on behalf of German government clients and others, while increasingly expanding its operations in the European private sector.
 To ensure that sensitive and classified German information is protected and not disclosed to foreign nationals or German nationals who do not have a "need to know," BDM will establish a Defense Security Oversight Board consisting of six German citizens, three of whom will be appointed by the Germany Ministry of Defense and the other three by the IABG board subject to approval by the Ministry of Defense. Gen. Wolfgang Altenburg, former chief of the defense staff of German forces and former chairman of the NATO Military Committee, has agreed to serve as co-chairman of the Defense Security Oversight Board, subject to approval by the Ministry of Defense.
 The BDM plan calls for a three-year transition from a government- owned company to a competitive private enterprise. The goal is to create new jobs in areas such as environment and information technology and to replace jobs lost as the German defense budget declines.
 Dr. William E. Sweeney Jr., BDM executive vice president, will become the general manager of IABG with duties similar to those of a chief executive officer. He will be assisted by a small group from BDM and by the senior leadership of IABG.
 IABG confronts a challenge similar to that faced and largely overcome by BDM, Odeen said, to reduce its dependence on military business and expand its ability to compete for civil government and commercial business. BDM has successfully transitioned from a company performing more than 85 percent of its work for the Department of Defense (DOD) to one where DOD business makes up only 50 percent of its business base.
 Odeen explained how the IABG acquisition fits into the company's long-range strategy, which calls for BDM to grow to billion-dollar revenue levels by the year 2000 (1992 revenue totaled $424 million):
 "Expansion of our international operations and an aggressive acquisition program are two elements of our strategic vision addressed by the IABG acquisition plan. BDM has already acquired Vinnell Corporation (1992), which has large-scale operations in the Middle East, and FACE/Logisticon (1993), which serves as the European arm of BDM's manufacturing services and logistics automation business."
 Sweeney discussed the similarities and differences between IABG and BDM: "IABG's work force is highly skilled and multidisciplinary; so is BDM's. BDM and IABG perform many of the same types of technology-based services with three principal differences: (1) BDM does not own and operate test facilities to as large an extent as IABG; (2) IABG does not engage in large-scale information systems integration to the extent that BDM does; and (3) IABG receives most of its contract efforts on a non- competitive, sole-source basis, while BDM has successfully competed for the vast majority of its contracts over the past decade."
 Sweeney said that BDM is ideally equipped to introduce the technology services industry to Europe. "The same needs and drivers for such services exist in Europe as in the U.S.: highly specialized and increasingly complex business and governmental requirements that are of short-term or uncertain duration and requirements to use technology to modernize operations, design and integrate networks and systems and find other technology-based solutions and implement them," he said.
 "The acquisition of a majority ownership in IABG," Sweeney said, "provides a substantial presence in Europe for BDM's range and quality of technology services. We expect that the mutual interest and support linking IABG and BDM will result in major growth opportunities for both companies and provide important steps toward a worldwide confederation of services firms operating as part of BDM International."
 He summarized the current areas of IABG support services as follows: software engineering and information technology; analysis, new concept development, system evaluations, command and control and logistics planning, principally for the German military; and health, economics, education and social welfare analysis. Sweeney identified an exciting new area of work at IABG in environmental assessment, particularly of former Soviet military sites in the new German states.
 "IABG's largest business area and most extensive facilities," he noted, "are in the test and evaluation (T&E) area." IABG provides T&E to assess and/or confirm functionality, quality and reliability and safety in such areas as:
 -- Structures and materials
 -- Acoustics
 -- Space technology
 -- Electromagnetic compatibility
 -- Environmental simulation
 -- Sensor technology
 -- Inertial systems and navigation.
 BDM International, Inc., is headquartered in McLean (metropolitan Washington). The company provides scientific, engineering, technical and expert services to public and private sector clients in national defense, transportation, communications, energy, environment, logistics, space, information systems, advanced technology, manufacturing technology, systems integration, product distribution, operations and maintenance and public policy. The company has approximately 4,600 employees and operates in more than 60 worldwide locations.
 -0- 6/21/93
 /CONTACT: Todd A. Stottlemyer of BDM International, 703-848-5115/


CO: BDM International; Industrieanlagen-Betriebsgesellschaft ST: Virginia IN: ARO SU: TNM

DC-MH -- DC004 -- 3949 06/21/93 09:39 EDT
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Date:Jun 21, 1993
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