US subsidiary acquisition

QinetiQ Group plc
04 April 2006



4 April 2006                                            For immediate release

                QinetiQ's US subsidiary agrees $53m acquisition

Apogen Technologies, one of QinetiQ's principal US subsidiaries, announced today
that it has signed an agreement to acquire San Diego-based Ocean Systems
Engineering Corps (OSEC), a leading provider of research, design, development,
and integration of advanced information technology systems to key defence
agencies. The acquisition will be settled for a cash consideration of $53m and
is expected to close by the end of June 2006, pending US government approvals.
OSEC is currently owned by its founder and majority shareholder, managers and
staff.

'OSEC's experience and reputation in mission-focused defence systems represents
an area we have been looking to grow into for some time,' commented Paul Leslie,
President and CEO of Apogen. 'OSEC's custom software applications, engineering
services and hardware products, combined with Apogen's IT integration and
management expertise, will create a strong, diversified company capable of
competing to enterprise-wide projects.'

Founded in 1990, OSEC provides software and engineering services to several US
Department of Defense (DoD) customers including the Marine Corps Systems
Command, with which it has a 10-year relationship, and Space and Naval Warfare
Center which has been a customer since 1990.

'The combination of complementary capabilities and shared corporate values made
it obvious that Apogen was the right company to help take our solutions to a
broader market,' said Pat Moneymaker, OSEC's CEO. 'Our team is excited to begin
tapping into the resources of Apogen and the wider QinetiQ capabilities to
expand our service to our customers.'
OSEC reported revenues of $48.2m, EBITDA of $4.8m and earnings of $2.7m in 2005
(calendar year)(1). Upon regulatory approval, OSEC will become a wholly-owned
subsidiary of Apogen Technologies.
                                      ends


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Notes for Editors:

  • QinetiQ (pronounced ki net ik as in 'kinetic energy') is a leading
    international defence and security technology company that was formed in
    July 2001 from the UK Government's Defence Evaluation & Research Agency
    (DERA). Today, QinetiQ has around 11,400 employees, who deliver
    technology-based services and exploit QinetiQ's strengths in technology
    research by selling systems solutions, products and licences to government
    and commercial customers in a spectrum of defence, security and other
    commercial markets.


  • QinetiQ has developed a significant overseas customer base and has
    established a US sales operation in Crystal City, near Washington DC to
    forge closer links with this significant market.  In October 2004, QinetiQ
    acquired the businesses of Foster-Miller Inc, in November 2004 it acquired
    Westar Aerospace & Defense Group Inc and in September 2005 it acquired
    Apogen Technologies Inc.  Also in September 2005 Foster-Miller acquired
    Planning Systems Inc and QinetiQ acquired a 90% share of Verhaert Design and
    Development NV (VDD), the leading Belgian space systems integrator, which is
    being renamed Verhaert Space NV.


  • QinetiQ Group Plc's annual report and accounts to 31 March 2005,
    published in July 2005, highlighted a 33.1 per cent rise in operating
    profits* to £69.3m on turnover which rose by 9.7 per cent to £872.4m.  These
    results were driven by a step change increase in business from North
    American customers.


  • On 15 February 2006, QinetiQ Group plc was listed on the London Stock
    Exchange - main market.

     *Note: Before exceptionals, intangible amortisation and impairment of
      goodwill, including share of losses in joint ventures and associates.


About Apogen Technologies

  • Apogen Technologies provides technology solutions to government entities
    to address their complex, mission critical challenges of national
    significance. Current customers include: U.S. Department of Homeland
    Security, U.S. Department of Agriculture, U.S. Census Bureau, U.S. Customs
    and Border Protection, U.S. Department of Defense, U.S. Department of
    Energy, Internal Revenue Service, and the U.S. Navy. Apogen Technologies is
    ranked number 48 on Washington Technology's Federal 100 list and is also
    listed in the top 10 Department of Homeland Security contractors. Apogen
    Technologies' growth has been noted with a 10th place ranking on the
    Washington Business Journal's 50 fastest growing company's list and a 35th
    place rank on Deloitte's Virginia Fast 50 list. Apogen has been named a best
    place to work by both New Orleans CityBusiness and the Washington Business
    Journal. Apogen Technologies is a wholly owned subsidiary of QinetiQ North
    America. More information can be found at www.apogen.com.

About OSEC

  • OSEC is a small, veteran-owned San Diego-based business that, since its
    founding in 1990, has firmly established an exceptional reputation for
    providing customers with innovative and effective solutions across a wide
    spectrum of complex and important challenges. OSEC is a full spectrum
    engineering product developer and services provider with a client base that
    spans the Department of Defense as well as other Federal, State, and Local
    government organizations and commercial firms. OSEC's Corporate Office is
    located in Carlsbad, CA. Operations facilities are located in San Diego, CA;
    Stafford, VA; Dahlgren, VA; Arlington, VA (Crystal City); Lemoore, CA; and
    Panama City, FL.

                    For further information, please contact
                 Nicky Louth-Davies on Tel: [phone]
                          Email: [e-mail]

                      Visit the website at www.QinetiQ.com


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(1) As reported by OSEC under US GAAP



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