A swath of new business cards were ordered and titles were changed as the D.C. tech community's M&A activity got hot in October.
The month brought upwards of $270 million in local startup funding alone, but on the exit side of investments, a wide range of technology companies – and the usual government contracting suspects – are tying the knot.
Here are the biggest D.C.-area merger and acquisition deals from October.
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Tech Data agreed to acquire DLT Solutions, a Herndon-based government IT solutions aggregator. Financial terms weren't disclosed. DLT was last sold to private equity shop Millstein & Co. in 2015, when it ranked as one of Washington Business Journal’s largest private companies in 2016. By 2017, it had about 250 employees. More here.
D.C.-based New Frontier Data, a provider of data and analytics tools to the cannabis industry, is acquiring Houston's Zefyr in a $10 million cash and stock deal. Zefyr develops a data discovery and profiling platform for the cannabis industry, and has worked with New Frontier for about a year as a partner. They plan to layer their data sets and combine algorithms to more accurately predict cannabis consumer behavior following the deal. Read more.
D.C.-based CoStar Group agreed to acquire Smith Travel Research for $450 million in cash, extending its long acquisition streak in the hospitality industry. Tennessee-based STR aggregates data from 65,000 hotels worldwide, according to a release, distributing 1.2 million reports monthly. CoStar has spent more than $2 billion in recent years to buy companies including Apartments.com, Dominion Enterprises’ ForRent network, LoopNet and LandWatch.com; but it also has reduced its local employee count to focus on a Richmond research hub. Read more.
Lockheed Martin executives announced that the firm plans to sell its distributed energy business division to Massachusetts-based TRC Cos. The deal would divest its Distributed Energy Solutions group — which provides energy management services to electric and gas utilities — from the Bethesda-based defense giant's Lockheed Energy arm. Terms of the acquisition were not disclosed. Lockheed Energy began in 2016, formed partially from the 2014 acquisition of Massachusetts-based Sun Catalytix. Read more.
Bentonville, Ark.-based Movista Inc. announced the acquisition of Sterling, Va.-based Natural Insight in a combination of like-minded retail tech providers. The deal, backed by New York private equity firm Level Equity, brings together two major U.S. providers of retail-specific execution technology. Both firms focus on inventory and display management tech, which has grown in demand as brick-and-mortar stores find new ways to retain customers. As part of the transaction, Movista will also own a majority stake of Natural Insight’s Capango brand. Read more.
Engineering behemoth AECOM has agreed to sell its Germantown-based Management Services business to a pair of private investment groups for $2.4 billion. Management Services, a major federal contractor, has roughly 25,000 employees globally, with 2,700 AECOM staffers in the D.C. area. The sale to American Securities and Lindsay Goldberg is expected to close in the first half of 2020. Read more.
British defense contractor QinetiQ Group announced plans to acquire Lorton-based Manufacturing Techniques Inc. for $105 million, more than doubling the size of its U.S.-based operations. The purchase provides QinetiQ, which offers services across the defense space, with MTEQ’s sensor development and rapid prototyping operations – which are in high demand at the Department of Defense. The deal will add MTEQ’s 360 employees to QinetiQ, increasing its U.S. headcount to about 750 employees. Read more.
D.C. edtech innovator EverFi announced its first international acquisition with the addition of EdComs, a company specializing in education that drives social change. EdComs, a 25-year-old company headquartered in London, has a client base that includes global technology companies, sports leagues, big consumer brands and several foundations. With the acquisition, EverFi will have a dedicated international presence and an on-site team in London to service global customers in Asia, Europe and the Middle East. Read more.
Honorable Mentions
Sources tell Bloomberg that Nordic buyout firm EQT AB is in talks to buy Herndon-based data center company EdgeConneX. It reports EQT is discussing acquiring the firm from investors including Providence Equity Partners in a deal worth $2.5 billion or more. EdgeConneX was founded in 2009 and has built 40-plus data centers in North America, Europe and South America, according to its website. Read more.
