Maximus sells part of its business to Constellation
- By William Welsh
- Sep 23, 2008
Maximus Inc. has signed an agreement with Constellation Software Inc. to sell three of its non-core business lines for $40 million.
Toronto-based Constellation Software will purchase Maximus' justice, education and asset software solutions for $35 million at closing and an additional $5 million one year after closing. The sale is expected to close Sept. 30
The sale will enable the Reston, Va., state and local government contractor to focus on its core health and human services program administration and consulting offerings, company officials said.
"Today's announcement fulfills a promise we made to our shareholders to center our operations around our core health and human services offerings," Richard Montoni, chief executive officer of Maximus, said in a statement. "With increased operational focus, we expect the benefits to include a more predictable base of recurring revenue and stabilized margin performance."
In the wake of the sale, Maximus will roll its enterprise resource planning division, which was previously part of its systems segment along with the three areas being sold, into its consulting segment. In the aftermath of the sale, the company will proceed with operating and consulting segments.
For fiscal 2008, Maximus anticipates a loss from discontinued operations in the range of $1.38 to $1.44 per diluted share. As for fiscal 2008 revenue, the company anticipates annual sales from continuing operations of between $745 million and $750 million.
Maximus ranks in the $500 million to $1 billion category of Washington Technology's 2008 State and Local Who's Who
William Welsh is a freelance writer covering IT and defense technology.