San Diego Business Journal

Don't expect Science Applications International Corp. to alter its course markedly with changes in its top management, said one of the people affected by those changes.

SAIC may put "a little more emphasis in the strategic development of the company" through investments in other companies, said executive William A. Roper Jr.

Yet SAIC, which is already involved in a number of diverse, high-tech businesses, will not head off into new waters. "We're not going to go out and become something new and different," said Roper, 54.

Roper left SAIC's chief financial officer position, which he has held for more than 10 years, last month. He retains the title of corporate executive vice president and is now chairman of the board of the SAIC Venture Capital Corp.

He said he was trying to serve in two roles: as chief financial officer of a company with 40,000 employees and revenues approaching $6 billion, and as the team leader handling acquisitions for SAIC.

"Those two functions are too important to have one person wear both hats," said Roper.

Taking the CFO chair and a newly created executive vice president's slot is Thomas E. Darcy, 50, who has had a long association with the company through his former employer, PricewaterhouseCoopers LLP. SAIC's board approved both Darcy's and Roper's new jobs Oct. 13.

Darcy said he is still learning much about the company. He said transactions like those completed by SAIC "take a lot of time to do well," adding that SAIC had, indeed, handled them well.

In a prepared statement, company founder, chairman, CEO and president J.R. Beyster pointed to increasingly complex work at the company as a reason for expanding the financial management team.

"The growth of our commercial business activities and the success of our technology investments have made SAIC's organizational and financial structure much more complex, and the management of these activities has become increasingly important to both our strategic and financial results," he said.

SAIC is a research and engineering company that provides information technology services, systems integration and E-business products and services. Recent large acquisitions include Bellcore, now Telcordia Technologies, in 1997.

SAIC also earned windfall profits from the sell of Network Solutions, Inc., which it purchased in 1995 for $4.8 million. SAIC recently sold the firm, which registers Internet domain names, for about $4.5 billion in profits , part of it in stock.

Roper noted SAIC's revenues from telecommunications businesses is up substantially since it took over Bellcore. "I'd say a great deal of our future's in that area," he said.

At the same time, SAIC recognizes its history as a government contractor, still does half its work for the government, and does not intend to de-emphasize such work, Roper said. "You know, this was the girl that brought us to the dance," he said.

SAIC started its venture investing about three years ago, Roper said, and subsequently came to a realization.

"We looked up and we had a number of these investments, and we recognized that we really needed to formalize the way we managed them, because it was becoming meaningful in terms of numbers and sizes and things," he said.

The result was the creation of SAIC Venture Capital Corp. about a year ago.

"We look at transactions in the low hundreds of millions fairly regularly now," Roper said. "That would be something we would feel comfortable in digesting. We've looked at larger (deals) and we've made larger, as with Bellcore. But our sweet spot would be a few hundred million and down."

Part of the investing is fueled by profits from SAIC's sale of Network Solutions.

Asked about acquisitions now in the works, Roper declined comment, though he did counsel against expecting a major announcement soon. "There's nothing of any blockbuster size kind of on the burners right now," he said.

Roper added that in his opinion, many companies now carry "inflated" price tags.