Harris makes a deal for Multimax
- By Nick Wakeman
- May 31, 2007
Harris Corp. is buying Multimax Inc. in a $400 million deal that expands the Melbourne, Fla.-based company's technical services business and its access to large governmentwide contracts.
Multimax of Herndon, Va., brings several GWACs to Harris, including the Army's Information Technology Enterprise Solutions 2 Services and the Air Force's NetCents contracts.
The all cash acquisition is expected to close by June 29, Harris said.
Multimax had been evaluating growth strategies over the past six to seven months, Carleton Jones, Multimax chief executive officer, told Washington Technology. The strategies included going public and continuing as a private company. But as they went through that evaluation process, selling the company emerged as the best alternative, he said.
"There was a lot of interest in buying Multimax," Jones said. The company currently is owned by Cerberus Capital Management, a private equity firm.
Harris cinched the deal over other suitors because it is in a similar market ? information technology and communications ? and Harris is dedicated to the federal sector, he said. Multimax also is a subcontractor to Harris on its FAA Telecommunications Infrastructure contract.
"We know them and they know us," he said.
Multimax also is one of the largest subcontractors to EDS Corp. on the Navy-Marine Corps Intranet contract, Jones said.
For the year ended March 31, Multimax had about $315 million in revenue and $55 million in operating income. The company also has about 1,100 employees. About 85 percent of the employees have security clearances.
Jones said only about $40 million in Multimax revenue is not related to Defense Department customers.
"The acquisition of Multimax is complementary to our existing technical services business and provides additional scale," said Howard Lance, chairman, president and CEO of Harris.
Multimax will become part of Harris Technical Services Corp., based in Falls Church, Va. John Heller, Multimax's president and chief operating officer, will become the vice president of the defense IT programs. Karl Williams, Multimax chief financial officer, will become vice president of civilian IT programs. Both will report to Ted Hengst, the president of Harris Technical Services.
Harris ranks No. 21
on Washington Technology's 2007 Top 100 list
of the largest government contractors.
Nick Wakeman is the editor-in-chief of Washington Technology. Follow him on Twitter: @nick_wakeman.