Veritas Takeover of Dyncorp Earns $350 million for Company Boss

Wall Street Goes to War
Forbes, 8/3/09

HIGHLIGHT:

The battle for wartime profits is waged in the boardroom. Inside the most lucrative--and the ugliest--deal of the Iraq and Afghan wars.

For 19 years Robert McKeon and Thomas Campbell were inseparable. They raised money and struck deals together, buying and selling dozens of companies, often in the defense sector--smallish outfits such as Athena Innovative Solutions, Integrated Defense Technologies and Vertex Aerospace. Working 12-hour days out of next-door offices in midtown Manhattan, they could hear each other's phone conversations and knew the most personal details about each other. They golfed together, went skeet and trap shooting, traveled together for meetings and once shared a hotel room in Mexico. On Fridays they would dine, just the two of them, at Harry Cipriani, the ritzy Manhattan restaurant. 'I believe we were pretty close to best friends,' says Campbell.

They also hatched the most lucrative deal of the wars in Iraq and Afghanistan. Their 2005 purchase of DynCorp International, the Falls Church, Va. provider of services to the U.S. military, landed McKeon and Campbell at the center of a booming and controversial business. The leveraged buyout also helped rip apart their relationship. McKeon ended up very rich, personally earning $350 million, or seven times his investment, and in control of a company that has emerged as the biggest winner in the war game. Campbell, forced out of DynCorp, came away with very little and has started over. Today the two former friends are locked in mortal combat--trading accusations of greed and betrayal in protracted litigation and competing for $25 billion a year in battleground services contracts for the U.S. government.

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