The re-birth of Security Giant Blackwater
Despite new ownership, a new board and new management, security contractor Xe Services LLC could never shake a troublesome nickname: the company formerly known as Blackwater. Now, it's the company formerly known as Xe.
Virginia-based Xe plans to unveil a new name—Academi—and new logo. In an interview with The Wall Street Journal, Ted Wright, president and chief executive, said the name change aims to signal a strategy shift by one of the U.S. government's biggest providers of training and security services. Mr. Wright said Academi will try to be more "boring."
Founded by former Navy SEAL Erik Prince, the original Blackwater cultivated a special-operations mystique. But it was tarnished by a string of high-profile incidents, including a deadly 2007 shootout in Iraq that ultimately led to its reorganization and rebranding as Xe Services. Mr. Prince left the business in 2010, selling his stake to investor group USTC Holdings LLC.
Mr. Wright came on board this summer as part of a continuing corporate reorganization. In recent meetings with clients, he said he explained that the new corporate identity was supposed to stress the company's focus on regulatory compliance and contract management, in addition to its track record of protecting clients. "I tell them, from now on, I'm going to be in the background; I'm going to be boring," he said. "You're not going to see me in headlines."
But Mr. Wright may be courting controversy in one area. He said he would like to take Academi's business back to Iraq, and has hired an outside company to help it apply for an operating license there. "I think eventually, we're going to get a license; we're going to do business in Iraq," he said.
In its various incarnations, Academi has provided protective details for U.S. diplomats and officials in hot spots around the globe. But it is still excluded from one of the most lucrative markets for private security: The Iraqi government stripped the company of its operating license after the 2007 shootout.
Demand for security contractors in Iraq has surged, however. The State Department is hiring a large contract security force to protect the U.S. mission there, and private security firms also are eyeing possible work for energy companies as the Iraqi oil-and-gas sector opens up to foreign investment.
Deborah Avant, a professor at the University of Denver who is an expert on private security firms, said the State Department was hiring a "fairly large contingent of people that will be doing a variety of things" in Iraq.
Iraq's regulatory and political climate, she said, is fast-changing, and the dynamic will shift after the withdrawal of U.S. troops at the end of the year.
The rebranded Academi, meanwhile, wants to focus on a new line of business: security assessment. It already provides guards and runs training facilities, but wants to expands its offerings by assessing security risks for both private-sector and government clients.
The company said it has trained 50,000 people and conducted more than 60,000 protective security missions around the world in the past seven years. credit: online.wall street journal
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