| In This Issue
CEO Corner - Dr. Edward H. Bersoff,
Chairman, CEO and
President, ATS Corporation
The Federal Deal - The Engenuity Technologies Deal
Daily Deals - The Latest Sector M&A Deals
Minuteman Ventures LLC partners with InfoBase Publishers, Inc. to bring you expert analysis of recent federal M&A transactions. InfoBase is a provider of information on buyers and sellers in the global defense, aerospace, and government technology marketplaces. Their Defense Mergers and Acquisitions (DM&A) module is the most comprehensive collection of industry M&A data and analysis in existence.
InfoBase is a lot more than M&A. Their on-line service links the defense sector's latest news on companies, contracts and programs to insightful sector analysis, budget trends and M&A transactions.
For more on InfoBase Publishers and its web-based Defense/Aerospace Competitive Intelligence Service (DACIS), visit www.dacis.com or contact Bill Burton (email@example.com) (410.820.6821) for a personal tour.
|The Minuteman Federal Deal Meter
The Minuteman Federal Deal Meter covers M&A transactions of services firms principally serving federal agencies. Transactions covered are those announced from January 1, 2007 through April 8, 2007.
For the list of M&A transactions closed in the sector through April 8, 2007 and 2006, email firstname.lastname@example.org.
Dr. Edward H. Bersoff, Chairman, CEO
and President, ATS Corporation
A notable name in federal/defense IT circles,
Dr. Ed Bersoff has assumed the leadership of
ATS Corporation (ATCT.OB), McLean, VA, the
result of money raised in 2005 by a Special
Purpose Acquisition Corporation (SPAC). As
the name of its founding entity infers, ATS
is committed to growth via acquisition.
Bersoff founded and became President of
publicly traded BTG, Inc., a company acquired
by the Titan Corporation in 2001. He also
sits on the Boards of ICF Consulting and E.F.
Johnson, both public companies in the sector.
The SPAC is a Wall Street instrument that
allows funds to invest in a group of
prominent executives, with the intent to
exploit those persons’ industry sector
experience. Bersoff and his team launched as
Federal Services Acquisition Corporation
(FSAC), raising $126 million in an IPO in
FSAC was intent on finding private companies
to acquire that may be ready to operate in
the public markets, though not necessarily
with current management. On January 16,
2007, FSAC completed the acquisition of
Advanced Technology Systems, Inc., the only
federal services SPAC to have completed an
Minuteman caught up with Dr. Bersoff to gain
his views on SPACs, ATS, and the industry sector.
DMA: How active do you expect ATS to
be in the acquisition market?
EB: Very much so. Our targets are to
reach revenue of $300 million in three years
and $500 million in five years. While we
project 10% organic growth (higher than
industry average, says Bersoff), acquisition
will be key in filling the revenue gaps on
the way to those two targets. Our guidance
for fiscal year 2007 is for $115–$120
million in revenue, so, by definition, M&A
must play a strong role in our strategy.
For the entire interview, click
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The Federal Deal
FGR offers analysis of M&A transactions
government services contractors. The analysis is
Stuart McCutchan, president and CEO of InfoBase
Inc. © and editor of the Defense Mergers &
premier source for information on
Opinions expressed below are those of
reserved. For more on InfoBase Publishers'
Bill Burton (410-820-6821, email@example.com).
The Engenuity Technologies Deal
The decision by CAE Inc. (NYSE: CGT; TSX:
CAE) to purchase Engenuity Technologies Inc.
(TSX: EGY) speaks volumes about how far the
Canadian simulation powerhouse has come in
the half decade since it sold off its
cleaning products and forestry products
Having shed those failed diversifications,
CAE has since been busy gussying up its core
training and simulation business. (The
company has, in fact, become the
marketplace's leading consolidator.)
Geographically, a focus of its efforts has
been reconstituting its business in the U.S.
following the 1995 sale of CAE-Link to Hughes
(that business subsequently changed hands two
more times, and is now part of L-3
Link, with its heavy reliance on "big iron"
U.S. defense programs, was never really a
good fit with CAE. Having shed the business,
CAE moved to buy presences in marketplaces
more to its liking. Tampa, Florida-based
Reflectone, acquired from BAE Systems in
2001, added strength in transport and
helicopter simulation equipment, and also
added significant training and support
services activities for both the commercial
and military market. Dallas/Ft. Worth-based
SimuFlite Training International, acquired
later the same year, made CAE the world's
second largest provider of business aviation
training — the largest outsourced and
full-service training market segment.
Looking beyond geography, in these moves one
could see the beginnings of a second trend as
well: a shift away from flight simulators
themselves to a focus on the mission of
training. In recent years this shift has
accelerated, as CAE eschewed
hardware-oriented deals in favor of targeted
- In 2004 the company acquired Greenley &
Associates, a fast-growing Canadian
professional services provider with a focus
on project management, human factors,
business analysis & usability, and modeling &
- In 2005 it acquired Tucson, Arizona-based
Terrain Experts, Inc. (TERREX), a company
specializing in COTS simulation software that
makes database development simpler and more
accessible to the entire simulation market
- In Jan. 2007 it acquired Australia's
KESEM International Pty., a company
specializing in the application of modeling
and simulation to decision support systems
for the defense and homeland security
markets. This deal, like Greenley, added to
the company's CAE Professional Services business
With the acquisition of Engenuity
Technologies, CAE has again (as it did with
TERREX) added COTS simulation and
visualization software for the aerospace and
defense markets. Though Engenuity is
Canadian, it brings with it a U.S. presence
through recently-acquired AcuSoft, a modeling
and simulation products and services company
based in Orlando.
What these deals have in common is a move
away from hardware and towards software, away
from simulators and towards decision tools.
We are intrigued by some of the technologies
which Engenuity is bringing to the table, and
in particular its STAGE simulation toolkit,
used to create and interconnect simulation
Engenuity also brings to CAE a rich dowry of
operating locations: In addition to its
Montreal headquarters, Engenuity Technologies
has offices in Orlando, Atlanta, London,
Paris and Dusseldorf, as well as a worldwide
distributor network. It occurs to us that the
company's challenge in realizing the value of
its acquisitions will be to interconnect
those far-flung locations with its
technology, creating a network capable of
channeling decision making solutions where
and when they are needed.
It is a vision which is already dawning. In
deals like these we are seeing the first
steps away from the simulators which once
seemed nearly as iconic as the aircraft for
which they prepared pilots — and
towards a software-driven future where
simulation, training and modeling become
hardware-agnostic, task-oriented solutions
which increasingly insinuate themselves into
processes and workspaces which are far afield
from traditional "simulator time". In this
future hardware will be a commodity and
software will be king. We will know that
future is fully upon us when companies like
CAE, Thales and Link move at last to sell the
simulator businesses which they are now
merely de-emphasizing, and step fully into
their inevitable role of "fab-less" integrators.
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the sale of their businesses, and assists
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team consists of experienced entrepreneurs and
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We specialize in companies that sell services,
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