Tag Archives: ACP

2016 Review & 2017 Outlook: The Trump Effect

A total of 92 M&A transactions were announced in the defense technology and government services market in 2016, which was slightly below the 107 transactions completed in 2015, but in-line with 2013 and 2014 levels. M&A in 2016 witnessed a “normalization effect” after the flurry of activity that occurred in 2015. Contractors have started to notice the effects the 2013 and 2015 Bipartisan Budget Act’s sequester relief has had on the overall procurement environment. This relief has allowed the Department of Defense to significantly reduce the amount of anticipated cuts in technology operations and maintenance, translating into strong performance across the defense technology and government services market. As we enter Fiscal Year 2017, we expect to see similar trends in M&A, fueled primarily by better visibility in the budget and continued emphasis of future federal funding priorities brought on by the new Trump Administration. Read the entire Quarterly Newsletter here to review the following topics more thoroughly discussed:

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Positive Trends Continue in the Federal Market

There continues to be positive momentum across the defense and government services market for publicly traded (e.g. Tier-1, Mid-Tier, Non-Traditional) and smaller, privately-held government contractors. Uncertainty around federal spending seems to be in the “rearview mirror” and companies are witnessing clearer funding visibility on current and future programs. Furthermore, over the past 12 – 18 months public contractors have repositioned portfolios to focus on core, higher margin business segments that provide greater returns to shareholders. Read the entire Q3 2016 Newsletter here to review the following topics more thoroughly discussed:

  • Tier-1 Government Contractor Update
  • Mid-Tier Government Contractor Update
  • Non-Traditional Buyers Remain Hungry in the Federal Market
  • Aronson Capital Partners Advises PROTEUS Technologies, LLC on its Sale to Polaris Alpha

Aronson Capital Partners Advises Proteus Technologies on its Sale to Polaris Alpha, a Portfolio Company of Arlington Capital

WASHINGTON, Nov. 14, 2016 /PRNewswire/ — Arlington Capital Partners (“Arlington Capital”), a Washington, DC-area private equity firm, today announced the formation of Polaris Alpha (“Polaris” or the “Company”), a leading provider of mission-critical technology, software, and solutions to premier customers in the defense and intelligence communities.

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Pockets of Growth in the Federal Market

In spite of relatively stagnant growth prospects across the defense and government services market, there are sub markets that continue to experience outsized growth, including Cybersecurity, C4ISR, Data Analytics and Healthcare IT. The forecasted growth in these sub segments is outpacing the broader federal IT outlook and is therefore driving M&A activity. Read the entire Q2 2016 Newsletter here to review the following themes more thoroughly discussed:

  • Federal Initiatives Spawn Cybersecurity Spending and M&A
  • New C4ISR Technologies Drive Q2 Awards
  • Enterprise-Wide Adoption of Data Analytics Will Continue in 2016
  • Patient Care and Efficiency Take Center Stage

Aronson Capital Partners is a leading middle-market investment bank focused exclusively on the government services and technology industry. Please feel free to contact one of our principals below with any questions.

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The Evolving Buyer Landscape in the Government Services Market

The relative budget stability and clarity has driven a renewed interest in government services acquisition targets by commercially focused information technology, consulting, and engineering buyers. Meanwhile, private equity firms have recently demonstrated confidence in this market by making new federal platform investments and bolt-on acquisitions for their commercially focused existing platforms. These buyers were previously on the sidelines for the past few years given the federal sector’s growth challenges and uncertainty.

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