M&A

Jacobs buys Verizon Federal Network Systems unit

EDITOR's NOTE: A version of this story first appeared on FCW.com.

Verizon is selling its Federal Network Systems business unit to Jacobs Engineering Group as that company builds out its IT capabilities in the classified world.

The sale does not effecitve Verizon's focus on the enterprise business it has been building in the public sector, company officials said.

Federal Networks Systems is a 750-person unit of Verizon that specializes in providing defense and intelligence community customers with IT and communications network integration and operation, consulting and data security services. Its publicly acknowledged clients include the Defense Information Systems Agency, the Defense Advanced Research Projects Agency, NASA and the Departments of Energy and Treasury.

FNS came to Verizon as part of the merger between Bell Atlantic and GTE that created the communications giant in 2000. Its corporate roots go back to the legendary firm of Bolt, Beranek and Newman, which built the ARPANET and was instrumental in developing many innovations that allow computers to operate as nodes of a network.

The move reflects Verizon's focus on the core enterprise business it has been building with its own telecommunications offerings in wireless and broadband, and through its acquisitions of Terremark, Hughes Telematics and Cloudswitch.

"Verizon has a vibrant and growing public sector business that we've never been more committed to serving," Mike Maiorana, senior vice president of sales for Verizon Enterprise Solutions' Public Sector Division, told FCW. "The strategic services, the enterprise grade services that we're focused on to strengthen our agencies' business like global IP, cloud, security, networks, wireless, machine to machine – these are all growth and investment areas within Verizon."

For Jacobs, the deal appears mostly to be about the deep experience of FNS's approximately 750 staffers in the world of classified IT and communications. They will move to Jacobs when the deal is completed. The acquisition positions the firm to integrate classified communications systems and support into their architectural and engineering operations.

"We expect our acquisition of FNS to significantly enhance our capability in the growing Intelligence Community industry, allowing us to augment our service offerings to government clients for whom we currently provide mission critical operations, facility design, commissioning and technical services," Jacobs Group vice president Robert Norfleet said in a statement.

The deal is expected to close this summer.

About the Author

Adam Mazmanian is a staff writer covering Congress, the FCC and other key agencies. Connect with him on Twitter: @thisismaz.

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