CHANTILLY, Va., 26 Feb. 2015. Engility Holdings Inc. (NYSE:EGL) has completed its acquisition of TASC Inc. for approximately $1.3 billion, creating “a leading government services provider with a customer footprint that spans the federal services market,” officials say.
“This transformational acquisition accelerates our growth strategy to further diversify our customer base, enhance our capabilities, add scale to our business, and increase our addressable market,” says Engility President and CEO Tony Smeraglinolo. “In addition to these strategic benefits, this acquisition offers many compelling financial characteristics including significantly improving our cash flow and adjusted earnings. We believe our differentiated business model will benefit TASC’s intelligence and space customers, and we look forward to leveraging the strengths of both companies to create additional value for our customers, employees and shareholders.”
Founded in 1966, TASC is a provider of enterprise systems engineering, mission-enabling architectures, and value-based solutions for the national security and public safety markets. TASC has a substantial presence in the intelligence community, space and other markets in which Engility was underrepresented. TASC has approximately 3,700 employees and is a prime contractor on approximately 85 percent of its work.
TASC enhances Engility’s existing broad services offerings by adding capabilities in intelligence analysis, space systems architecture analysis, cyber forensics and cybersecurity, intelligence, surveillance and reconnaissance operations, geospatial intelligence, data analytics, enterprise transformation, test and evaluation, secure cloud computing and mobile applications.
TASC’s technical capabilities complement Engility’s cost-efficient business model, allowing the combined company to deliver affordable, high-quality services to its expanded customer base. For 2014, the combined company generated estimated revenue of approximately $2.5 billion and adjusted EBITDA of $210 million.
Engility now has a significantly more diversified and balanced portfolio across the government services industry. The combined company has a leadership position in the Intelligence community and high-end technical consulting markets. In addition, the defense market comprised approximately 61 percent of Engility’s revenue in 2014. Upon completion of the TASC merger, the company expects defense to comprise approximately 47 percent of its revenue base. The balance of its business will be split almost equally between its Intelligence and Federal Civilian agency customers.
TASC brings more than 850 contracts and task orders to the combined company, which together will have more than 2,000 contracts and task orders. TASC’s contracts and task orders have minimal overlap with Engility’s current contract vehicles and customers.
In addition to the Intelligence community, the combined company now has a meaningful presence and longstanding relationships with an attractive and expanded customer set, including the U.S. Air Force, NASA, and the Defense Information Systems Agency, among others. The transaction also enhances the combined company’s position with the Department of Homeland Security, Defense Threat Reduction Agency, Federal Aviation Administration, Missile Defense Agency, and Naval Sea Systems Command. This transaction substantially expands Engility’s addressable opportunities in the government services market.
Engility is a pure-play government services provider that delivers skilled personnel wherever, whenever they are needed in a cost-efficient manner. The company serves customers that span the federal services market including the Department of Defense, the Intelligence community, Space and Federal Civilian agencies. Headquartered in Chantilly, Va., Engility is a provider of specialized technical consulting, program and business support services, engineering and technology lifecycle support, information technology modernization and sustainment, supply chain services and logistics management, and training and education for the U.S. Government.
