--- title: "Leidos put its $625 million screening business into an Altaris JV it cannot leave on its own before 2033" description: "An October 5 filing puts Leidos at 41.5% of an Altaris-controlled screening joint venture it cannot leave on its own before October 2033; Altaris can pull it into a sale sooner. The same week brought a $672.5 million TSA re-selection and a JPMorgan downgrade to Neutral." publisher: "The Inference" section: "Deals" published: 2026-10-10T21:16:38.823Z modified: 2026-10-10T21:16:38.823Z canonical: https://theinference.org/article/leidos-put-its-625-million-screening-business-into-an-altaris-jv-it-cannot-leave-on-its-own-before-2033 language: en keywords: "Leidos, Joint Ventures, Government Contracting, TSA, M&A, Defense" --- # Leidos put its $625 million screening business into an Altaris JV it cannot leave on its own before 2033 > An October 5 filing puts Leidos at 41.5% of an Altaris-controlled screening joint venture it cannot leave on its own before October 2033; Altaris can pull it into a sale sooner. The same week brought a $672.5 million TSA re-selection and a JPMorgan downgrade to Neutral. Two days after [Leidos](https://theinference.org/markets/companies/leidos) closed the transfer of its checkpoint-screening equipment business into a joint venture controlled by the investment firm Altaris, the trade press reported [the TSA had re-selected Leidos for nationwide checkpoint screening](https://www.passengerterminaltoday.com/news/security/leidos-re-selected-for-tsa-nationwide-checkpoint-screening-contract.html) [1]. The award, issued September 28, is worth up to $672.5 million over eight years, replacing a $470.7 million, five-year contract from 2021 [2]. The document that prices the week is the [Form 8-K filed October 5](https://www.sec.gov/Archives/edgar/data/1336920/000119312526413208/d157380d8k.htm), recording the close of Nickel JV Ultimate Parent, LLC, an Analogic-branded joint venture in which Leidos holds 41.5% of the equity [3][5]. ## A $625M business traded for 41.5% and no board control The contributed businesses carried about 1,500 employees and $625 million in projected 2026 revenue by [Leidos's own April count](https://www.sec.gov/Archives/edgar/data/1336920/000119312526155884/d148240dex991.htm), about 3.6% of the $17.2 billion it reported for the fiscal year ended January 2, 2026 [4][5]. Altaris affiliates took 58.5% of the venture, the right to appoint a majority of its board, and cash: they sold their remaining Analogic Holding stake into the JV, funded with new debt at the venture [3]. Altaris, a healthcare-focused investment firm, manages $10 billion [5]. ## Control runs one way Altaris holds drag-along rights, the kind that let a controlling holder pull minority holders into a sale [3]. Leidos holds tag-along rights, and liquidity demand rights that begin only after the seventh anniversary of the closing, October 2033, subject to timing and procedural limits [3]. No member owes the JV further capital, distributions of available cash come when the board decides, at least annually, and Leidos signed non-compete covenants [3][6]. Leidos kept the headlines; Altaris kept the boardroom. ## The case for the deal, and its limit The retained-work case is real. The TSA award covers deployment services, installing, relocating and decommissioning checkpoint machines, and trade coverage of the closing says Leidos keeps that work plus other airport screening outside the JV's scope, including a potential $270 million CBP inspection contract won in June [2][7]. Deal coverage framed the transaction as sharpened focus with retained exposure [8]. No filing allocates the new TSA revenue between Leidos and the JV; what the filings do show is a 41.5% stake, with cash distributions on a schedule an Altaris-majority board sets [3]. *Chart: **Checkpoint screening money is rising just as the equipment business becomes a 41.5% stake** Three bars comparing contract ceilings: the 2021 TSA checkpoint deployment contract at $470.7M, its 2026 re-selection at up to $672.5M, and a June 2026 CBP inspection award at a potential $270M.* *Contract ceiling values in millions of US dollars; the two TSA awards run five and eight years. Sources: GovCon Wire, October 1 and 6, 2026. [2][7]* ## The downgrade is about Health, not the joint venture nobody has priced JPMorgan [cut Leidos to Neutral from Overweight on October 8](https://seekingalpha.com/news/4651531-leidos-downgraded-by-j-p-morgan-as-defense-stocks-face-rocky-earnings-season), target $142 from $160, on weakening earnings expectations: revenue roughly flat at a forecast $18.1 billion in 2027 against an estimated $18.35 billion this year, adjusted EBITDA down to $2.14 billion from $2.45 billion, and Health segment margins falling from 22% to 16% [9]. The stated case runs through Health, not the joint venture [9]. *Chart: **JPMorgan sees Leidos revenue flattening and EBITDA shrinking into 2027** Column chart comparing JPMorgan estimates for Leidos in 2026 and forecasts for 2027: revenue falling from about $18.35 billion to $18.1 billion and adjusted EBITDA from $2.45 billion to $2.14 billion.* *JPMorgan estimates for 2026 and forecasts for 2027, billions of US dollars. Source: Seeking Alpha, October 8, 2026. [9]* Neither the award coverage nor JPMorgan's note asked where the screening recovery books [1][2][9]. The 8-K sizes the exposure: 41.5% of the equipment business, against a market cap of $14.78 billion [3][8]. DHS, meanwhile, [has pushed its NCCS 2.0 consolidation contract past its late-November award target](https://www.washingtontechnology.com/contracts/2026/10/dhs-kicks-its-network-cloud-and-cyber-consolidation-vehicle-down-road/416440/), and Leidos holds the core network security operations work on a short-term bridge order [10]. When third-quarter results land, the question worth asking is which aviation-security dollars are Leidos revenue, and which are a minority stake someone else can sell. ## Takeaway Leidos traded a $625 million screening business for a 41.5% stake it cannot sell on its own before 2033, while Altaris controls the board and any sale; the same week's TSA re-selection and JPMorgan downgrade both leave the stake unpriced. ## Sources 1. [Passenger Terminal Today, "Leidos re-selected for TSA nationwide checkpoint screening contract," 7 October 2026](https://www.passengerterminaltoday.com/news/security/leidos-re-selected-for-tsa-nationwide-checkpoint-screening-contract.html) 2. [GovCon Wire, "Leidos Wins $672M TSA Checkpoint Screening Deployment Contract," 1 October 2026](https://www.govconwire.com/articles/tsa-leidos-672m-seds-ii-checkpoint-equipment-deployment-contract) 3. [Leidos Holdings, Inc., Form 8-K (JV closing), filed with the SEC 5 October 2026](https://www.sec.gov/Archives/edgar/data/1336920/000119312526413208/d157380d8k.htm) 4. [Leidos press release, Exhibit 99.1 to Form 8-K filed with the SEC 15 April 2026](https://www.sec.gov/Archives/edgar/data/1336920/000119312526155884/d148240dex991.htm) 5. [Business Wire via Yahoo Finance, "Analogic and Leidos Complete Combination of Security Enterprise Solutions Businesses," 5 October 2026](https://finance.yahoo.com/technology/articles/analogic-leidos-complete-combination-security-122400819.html) 6. [Leidos Holdings, Inc., Form 8-K (Contribution Agreement), filed with the SEC 15 April 2026](https://www.sec.gov/Archives/edgar/data/1336920/000119312526155884/d148240d8k.htm) 7. [GovCon Wire, "Leidos, Altaris Complete Analogic Security Screening Joint Venture," 6 October 2026](https://www.govconwire.com/articles/leidos-altaris-analogic-joint-venture) 8. [Tipranks via The Globe and Mail, "Leidos Forms Analogic Security Screening Joint Venture," 6 October 2026](https://www.theglobeandmail.com/investing/markets/stocks/LDOS/pressreleases/4982669/leidos-forms-analogic-security-screening-joint-venture/) 9. [Seeking Alpha, "Leidos downgraded by J.P. Morgan as defense stocks face rocky earnings season," 8 October 2026](https://seekingalpha.com/news/4651531-leidos-downgraded-by-j-p-morgan-as-defense-stocks-face-rocky-earnings-season) 10. [Washington Technology, "DHS kicks its network, cloud and cyber consolidation vehicle down the road," October 2026](https://www.washingtontechnology.com/contracts/2026/10/dhs-kicks-its-network-cloud-and-cyber-consolidation-vehicle-down-road/416440/) --- Leidos put its $625 million screening business into an Altaris JV it cannot leave on its own before 2033 — The Inference. 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