Woodbridge information technology and cybersecurity services company Sev1Tech LLC was already well-positioned in a federal market that is increasingly pursuing modernization, but it just picked up an important capability through M&A.
Sev1Tech acquired New Orleans-based Geocent LLC in a deal announced Tuesday. Terms of the acquisition were not disclosed, but Sev1Tech CEO Bob Lohfeld told the Washington Business Journal the acquisition provides essential capabilities around DevSecOps software design.
The expertise in DevSecOps — where software engineers, operations personnel, security specialists and others collaboratively and iteratively develop applications — provides Sev1Tech with expanded access to existing federal customers, as well as new ones, by offering new capabilities, Lohfeld said.
“They fill a hole for us that we’ve been talking about for a long time,” said Lohfeld in a Zoom call. “They are not an infrastructure company like you would think Sev1Tech is, an IT modernization, enterprise IT company. They are much more on the [modeling and simulation], the development and what’s really interesting to me is on the science side of the business.”
While both companies have a hand in cloud services and technology modernization, the CEO said Sev1Tech’s capabilities focus more on the large infrastructure requirements of modernization, whereas Geocent specializes in specific software application design and development.
What’s more, Geocent’s engineering portfolio includes work on aerospace and propulsion systems engineering, security infrastructure services, radiation and thermal shielding, special materials development and other space offerings tied to its work with NASA.
Those capabilities complement Sev1Tech’s work on C5ISR systems (command, control, communication, computers, cyber, intelligence, surveillance and reconnaissance) because they add new facets of work the now-combined company can pursue. Lohfeld said some of that work was untouchable as separate businesses.
“Now Sev1Tech will kind of have the perfect trifecta of aerospace customers: security space, scientific space and commercial space all under one roof — that’s powerful,” he said. “The work that they are doing is all aerospace engineering, for the most part, like safety propulsion, software development around [modeling and simulation]. If you look at our aerospace business, it’s terrestrial networks, ground stations and all of the stuff about moving massive amounts of data.”
The combination expands Sev1Tech’s work with the Department of Homeland Security by providing it Geocent’s portfolio of contracts with Citizenship and Immigration Services as well as Immigration and Customs Enforcement to go alongside the former’s work with Customs and Border Protection and Coast Guard.
But because Sev1Tech largely focused on infrastructure modernization, Geocent’s software application work for the DHS opens up new avenues of business where Lohfeld said his company didn’t have a wealth of past performance — which is the lifeblood of federal contract competition.
As a result of the acquisition, the companies are going to embark on a 120-day integration plan. Once combined, Sev1Tech will total more than 1,000 employees and close to $250 million in annual revenue, $162 million of which is coming from Sev1Tech.
“Size is important, and in our market, getting over $200 million is really the critical point to survival,” he said. “Because you have to have the [general and administrative expenses] to invest in the bigger bids. You’ve got to be at a fighting weight that you can take the bigger bids down and with their past performance and our past performance, really the sky’s the limit.”
Geocents, which Lohfeld said has around 300 employees, has locations in Arlington and McLean, in addition to others in Huntsville, Alabama; San Diego; Charleston, South Carolina; New Orleans and Baton Rouge, Louisiana.
Lohfeld said Sev1Tech is looking to retain those locations, particularly the Arlington office, and will bring aboard most of Geocent’s senior leadership.
“It was really about that we wanted to infuse with them our IT modernization, their science and really just build a much more interesting capability,” he said.
