M&A

Former Black Box federal arm rebrands after sale

Private equity firm Arlington Capital Partners has acquired the government division of IT and telecommunications firm Black Box for $75 million cash and rebranded that business as “Tyto Athene.”

Herndon, Virginia-based Tyto Athene will continue to work as a systems integrator and managed services provider for communication systems used by defense and civilian agencies.

Current members of the management team including now-CEO Jeff Murray will continue to lead the business, Tyto Athene said Monday. Murray led the business as a senior vice president at Black Box.

The government business generated $119 million in Black Box’s most recent fiscal year and $8.9 million in operating income, Black Box CEO Joe Trammell said in an Aug. 20 earnings call.

Tyto Athene touts on its website eight core “solution pillars:” networking, unified capabilities, cyber assessments, managed services, wireless, video, access control and surveillance, and next-generation infrastructure.

This deal is evidence that traditional government market investors like Arlington Capital continue to find plenty of opportunity and platforms to build from. The firm acquired Integrity Applications International in February and IAI six months later purchased another defense IT outfit in Dependable Global Solutions.

Arlington Capital is also the same group that built up Polaris Alpha through a run of acquisitions and then sold it in May to Parsons Corp., which sought among other growth areas an increased presence in the classified space market.

Also in Arlington Capital’s portfolio is Endeavor Robotics, the unmanned ground vehicle maker seeking programs of record to grow organically out of but also looking at potential tuck-in buys.

Tyto Athene traces its roots to the former identity as NextiraOne under the ownership of private equity firm Platinum Equity. BlackBox acquired NextiraOne’s government, commercial and Canada-based operations in 2006 and added $270 million-$280 million in projected annual revenue at the time.

Other key leaders for Tyto Athene alongside Murray include Chief Operating Officer Chris Meilhammer and Vice President of Operations Jason Alexander. Meilhammer and Alexander were both vice presidents for the business under Black Box.

A pair of former Black Box CEOs in Terry Blakemore and Mike McAndrew will join the board of directors at Tyto Athene.

Investment bank Raymond James & Associates and law firm Jones Day represented Black Box in the transaction.

About the Author

Ross Wilkers is a senior staff writer for Washington Technology. He can be reached at rwilkers@washingtontechnology.com. Follow him on Twitter: @rosswilkers. Also find and connect with him on LinkedIn.

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