Small, mid-tier players drawn to strategic M&A activity
By
Nick Wakeman
The $38.8 million acquisition of Danya by DLH shows that small and mid-tier players remain active acquirers in the federal market.
It’s not just the big behemoths that are making deals in the government market; many small and mid-tier players are active as well.
The latest to cross our radar is DLH Holdings Corp. of Atlanta and its acquisition of Danya International of Silver Spring, Md. The $38.75 million deal was announced today and enhances DLH’s capabilities in program management, consulting and digital communications.
The combination will allow DLH to pursue larger opportunities in the government market “that would have previously been unavailable to either company standalone,” DLH CEO Zachary Parker said. DLH is a publicly traded company and had $65.3 million in revenue in 2015.
Among Danya’s federal customer are Health and Human Services, where it monitors grants made under the Head Start program. Also at HHS, the company works with the Center of Disease Control and Prevention. Other customers include the Navy and the Homeland Security Department.
DLH has worked at Veterans Affairs where it supports all seven of VA’s Consolidated Mail Outpatient Pharmacy locations.
The combination enhances DLH’s initiatives in four key areas:
- Medication adherence and medication therapy management solutions
- Telehealth research and service offerings to DOD and civilian agencies
- Health IT and information systems solutions and services
- Case management systems solutions and services
The combined company has a backlog of $300 million.
Danya’s CEO Jeff Hoffman has agreed to stay on for two years and servie as a strategic market advisor.
One of the things that is interesting to me is that while larger size is important, the combination is strategic as well, with both companies focused on aspects of the health IT market in the federal space.
Canaccord Genuity was DLH’s financial advisor on the deal. Other advisors included Holland & Knight and Becker & Poliakoff with Baker Tilly supporting due diligence.
KippsDeSanto & Co. served as Danya’s financial advisor with Greenberg Traurig providing legal services.
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