Commerce One execs buy govt. unit, form new company

Three executives of Commerce One's e-government division, together with three institutional investors, have negotiated a $9 million buyout of the Laurel, Md., operation. The firm, now called Aquilent, will officially open March 4.

Paul Brubaker and Howard Stern, along with a third executive who soon will join Aquilent but was not named, engineered the buyout, Stern said. Brubaker is chief executive officer of Aquilent. Stern is senior vice president.

Aquilent's institutional investors are Allfirst Financial, Warwick Group and Spring Capital, he said.

Brubaker was president of Commerce One e-Government Solutions Inc., and Stern was senior vice president of marketing development. E-business firm Commerce One Inc. is headquartered in Pleasanton, Calif. The 2,800-employee firm had revenue of $408 million in 2001. The government unit represented about $22 million of that.

Aquilent employs 127 and should grow 20 percent to 22 percent annually, Stern said.

Because of the bureaucracies and economic difficulties of Commerce One, it was difficult for the e-government group to hire promptly and get the right skills on board, Stern said. The new company will realize operating efficiencies as a small business and will have new opportunities to partner with larger systems integrators, he said.

Aquilent and Commerce One will maintain a strategic partnership in which Aquilent will be a preferred channel for Commerce One's e-marketplace product line in the government space, Stern said.

Brubaker was deputy chief information officer at the Defense Department during the Clinton administration. Previously, he was staff director for the Senate subcommittee on oversight of government management and the District of Columbia. He was instrumental in shaping the Information Technology Management Reform Act of 1996, known as the Clinger-Cohen Act, which introduced the chief information officer position to the federal government and streamlined the way the government buys and uses technology.

Stern's background includes executive marketing and business development positions with Reliable Integration Services, Sterling Commerce and Sterling Software and Sprint.

"We are sort of the embodiment of Clinger-Cohen," Stern said. "The solutions we deliver enable government to break down barriers and stovepipes, get rid of redundancies and improve overall government efficiencies. E-government is a burgeoning market. The new administration [is] pushing ... Clinger-Cohen and that is exactly where we play."

Aquilent's roots go back 22 years to Century Computing, formed in 1979 by five former NASA engineers. In 1998, the company was sold, becoming one of 10 AppNet divisions. In 2000, the unit was sold to Commerce One and split into commercial and e-government divisions.

Aquilent's work includes Web portals, Web-based applications, e-procurement solutions and scientific applications. Its customers include Naval Sea Systems Command, General Services Administration, U.S. Postal Service, National Institutes of Health and National Oceanic and Atmospheric Administration.

Stern said the group's successes include:

*An e-procurement solution for Naval Sea Systems Command in 69 days, which has resulted in $26 million in savings in 10 months;

*A Web-enabled application for NOAA that cut the time to deliver a commercial fishing license from 30 to 60 days, enabling the agency to increase its output fivefold;

*A Web collaboration tool for NASA that cut the time required to plan a Hubble Space Telescope mission from months to weeks.