Veritas to acquire troubled MZM
By
Nick Wakeman
The private equity firm Veritas Capital has made another move into the government IT market by picking up beleaguered Top 100 company MZM Inc. for an undisclosed amount.
The private equity firm Veritas Capital has made another move into the government IT market by picking up beleaguered Top 100 company MZM Inc. for an undisclosed amount.
MZM of Washington is ranked No. 100 on Washington Technology's 2005 Top 100 list of the largest government contractors. The company has been mired in controversy in recent months over the relationship of its majority owner, Mitchell Wade, with Rep. Randy "Duke" Cunningham (R-Calif.). A grand jury in California is investigating a real estate deal between the pair.
Cunningham served on the congressional committee that oversaw several MZM defense contracts. After the allegation arose, Wade resigned from MZM and Cunningham announced he would not seek re-election next year.
For Veritas, the acquisition is its third move into the government contracting market. In July 2004, the New York firm acquired McNeil Technologies Inc., an IT services firm in Springfield, Va. In February, Veritas acquired DynCorp International, a Fort Worth, Texas, technical services firm, from Computer Sciences Corp.
With MZM, Veritas is picking up 420 employees, about 85 percent with high-level security clearances. The deal is expected to close in September.
Veritas has formed a new company, Athena Innovative Solutions Inc., which will take over the employees, assets and contracts from MZM, Veritas said. James King will be the chief executive officer of Athena.
In an apparent nod to Wade's legal woes, Veritas said it was only assuming "specific liabilities associated with the ongoing operations."
MZM offers a broad range of services mostly to national-security agencies, including training, analytical support, operations support, campaign planning, language translation and investigative support. The company also provides services related to intelligence, counterintelligence, counterterrorism, biometrics, law enforcement, security and information technology.