SAIC, Inc.'s Board Approves Spin-Off Of Its Services Business

(RTTNews) - SAIC, Inc. (SAI) announced that its Board of Directors has approved the separation of its technical, engineering and enterprise information technology services business.

The company also said it declared a pro rata dividend to its stockholders, effective September 27, 2013, of all of the shares of SAIC Gemini, Inc., which will hold the spun-off business and be renamed Science Applications International Corporation in connection with the completion of the separation.

Each SAIC, Inc. stockholder of record as of the close of business on September 19, 2013 will receive, effective as of the distribution date, one share of common stock of Science Applications for every seven shares of common stock of SAIC held as of the record date.

The distribution of these shares will be made in book-entry form, which means that no physical share certificates will be issued, SAIC noted.

On the distribution date, SAIC will change its name to Leidos Holdings, Inc, the company said.

SAIC said its Board of Directors also approved a one-for-four reverse stock split of Leidos shares, effective immediately after the distribution.

In connection with the spin-off, Science Applications will incur about $500 million of debt financing and the proceeds of the debt financing will be used to pay a $295 million cash dividend to SAIC immediately prior to the completion of the spin-off.

SAIC intends to use the net proceeds it receives from this dividend for general corporate purposes.