NTT Data makes deal to expand in federal health

NTT Data Services has made its fourth acquisition over the last year and it’s one that directly goes for growth in the federal market.

NTT Data plans to acquire NETE by the end of this year. NETE provides digital design and transformation services to federal agencies with its main customer being the Health and Human Services Department.

Financial terms of the deal were not disclosed, but NETE is bring 300 new employees to NTT Data and adding health capabilities around digital services, agile application development, bioinformatics, advanced data analytics, cloud and cybersecurity. Sandeep Somaiya, NETE managing director, will join the NTT Data public sector leadership team after the deal closes.

NETE is a 20-year old company that works closely with HHS components such as the National Institutes of Health, Centers for Medicare and Medicaid, and Health Resources and Services Administration.

“Their digital capabilities and thought leadership enhance the value NTT Data can deliver to our public sector healthcare clients,” said Tim Conway, president of the public sector unit at NTT DATA Services.

This deal follows the acquisition earlier this month of Flux7, a business that expanded NTT Data’s relationship with Amazon Web Services and brought skills in cloud migration, DevOps and security. All of those skills are in demand across federal agencies.

NTT Data's first buy in its current run of deals was the December 2018 acquisition of Canada-based Sierra Systems Group. That transaction also brought to NTT Data skills in IT consulting, systems integration and application managed services that are also being increasingly sought-after in the federal market.

In April of this year, NTT Data acquired the former consulting division of health care IT company Cognosante to add IT strategy and project management work in support of systems used for Medicaid and other related programs. Conway told us in June as part of our annual Top 100 series that NTT Data was ready to make more acquisitions over the next 12-to-18 months.

Baird served as the financial adviser to NETE for the transaction.