Parsons' latest acquisition eyes converged, digital operations product library

Parsons Corp. has agreed to acquire Blackhorse Solutions in a $203 million transaction to add more products and services in areas such as cybersecurity, digital operations and automation.

Blackhorse will become a part of Parsons’ federal solutions segment upon closure that is expected in July and also add nearly 200 employees to the acquirer’s workforce, the companies said Thursday.

Led by CEO Mike Kushin, Blackhorse was founded in 2018 and designs its offerings to help defense and intelligence agencies bring together their cyber, electromagnetic warfare and information functions. The company also emphasizes artificial intelligence and machine learning functions in its products.

During a March virtual investor day, Parsons executives said their ideal pace on closing acquisitions is one or two per year and deals must fit these two financial criteria: revenue growth of at least 10 percent and generating at least 10 percent EBITDA margin (earnings before interest, taxes, depreciation and amortization).

A potential deal target’s library of intellectual property for hardware and software products is also something Parsons looks at in its M&A strategy, which supports the push toward larger contracts of longer durations with a high technology component.

“Adding BlackHorse increases our scale in the areas of cyber, electronic warfare, and information dominance, enhancing Parsons’ position to pursue and win upcoming large joint all-domain contract opportunities, which is a key component of our national defense strategy,” Parsons Chairman and CEO Chuck Harrington said in a release.

Before the deal for Blackhorse, Parsons’ most recent acquisition was for Braxton in the fall of last year to gain more of a presence in supporting enterprise ground systems used for space operations.

In its announcement of the Blackhorse deal, Parsons said the $203 million transaction value is approximately 11.5 times the acquired company’s expected 2022 adjusted EBITDA.

The transaction also represents an exit by Razor’s Edge Ventures and Ten Eleven Ventures, a pair of co-investors and venture capital firms that have supported Blackhorse since its inception.

Parsons was advised by Baird and Latham & Watkins LLP. BlackHorse was advised by Raymond James & Associates and Cooley LLP.