Defense contractor Leidos Holdings announced Wednesday it will separate its security and automation divisions to create a new partnership with security imaging company Analogic Corporation.
Analogic, which is owned by investment firm Altaris, specializes in magnetic resonance imaging technology and airport baggage screening systems.
The arrangement will see Leidos transfer its security enterprise solutions, ports and borders, and industrial automation divisions to the new entity. These operations include approximately 1,500 workers and are projected to generate $625 million in revenue by 2026.
According to Leidos, the merger is designed to speed up development of security technologies and promote advancement toward artificial intelligence-based and three-dimensional imaging systems.
The Virginia-based defense contractor will maintain a 41.5% ownership interest in the combined company when the transaction completes. The new entity will continue operating under the Analogic name as a private company with current CEO Tom Ripp remaining in charge.
“This transaction expands our product portfolio and sales channels, enabling us to support global customers across the full lifecycle of security screening,” Ripp said in a separate release.
The companies expect to finalize the deal during the second half of 2026.
