Govt. Market Fuels ManTech's IPO Plan

ManTech International Corp. is looking to raise up to $92 million through an initial public offering of stock, money the company will use to fund growth, reduce debt and possibly make acquisitions, according to documents filed Nov. 23 with the Securities and Exchange Commission.

The Fairfax, Va.-based company provides a range of information technology and technical services, primarily to government. ManTech's revenue for 2000 was $378.8 million, and revenue for the nine months ended Sept. 30 was $316.3 million, more than 12 percent higher than the same period last year.

In its SEC filing, ManTech said that about 84 percent of its revenue in 2000 and 2001 derived from defense and intelligence customers.

With the national economy in a recession, and the dot-com bust drying up enthusiasm for startups, ManTech is moving to capitalize on the increased visibility of companies serving the government market following the Sept. 11 terrorist attacks, said Tom Meagher, vice president of equity research with BB&T Capital Markets, Richmond, Va.

"People are starting to realize that being in government is not such a bad deal," Meagher said. "That was probably the reason [ManTech] decided to go when they did."

Meagher said investors became accustomed to 100 percent growth rates year over year during much of the 1990s, but the market bust has redefined their expectations. "Now they're happy with 20 percent," he said.

Companies in the federal sector have another advantage in uncertain economic times: Government contracts tend to last over several years, with a steady amount of work being carried out each year. This makes revenue predictions much more sustainable, he said.

"I can tell you from year to year what their revenue stream will look like," Meagher said.

A date for the sale of stock and a proposed share price has not been set. The offering is underwritten by Jefferies & Co., Los Angeles, and Legg Mason Wood Walker Inc., Baltimore.

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