Cordant, DynCorp up for sale

Consolidation intensified last week in the federal information technology market with Cordant Inc. and DynCorp seeking buyers.

Cordant, a Reston, Va., integrator, reportedly has been conducting an auction, using the approach employed by PRC in its recent sale. Sources familiar with the discussions said two companies - Wang Federal Inc. and Litton/PRC Inc. - are still bidding on Cordant. And DynCorp, also of Reston, has retained investment banker Bear Stearns & Co. Inc. "to analyze the company and its businesses with a view to determining the potential value of the company to a third-party purchaser," according to a DynCorp filing with the Securities and Exchange Commission.

Cordant and DynCorp operate in the middle tier of federal IT vendors. Cordant, a privately held company, holds such major contracts as the Air Force's Integration for Command, Control, Communications, Computers and Intelligence and the Naval Facilities Engineering Command's Computer-Aided Design-2.

DynCorp, with 1995 federal IT contract activity of $270 million, has prime contracts on the Transportation Department's Information Technology Omnibus Procurement and the Treasury Department's Treasury Information Processing Support Services program.

Peter Kusek, the chief executive officer of Cordant, declined to comment on whether the company is for sale or if he has been negotiating with potential buyers. A spokesman for PRC parent Litton Industries Inc. and a spokeswoman for Wang likewise declined to comment.

Litton, however, has expressed interest in acquiring companies that would complement PRC, according to industry executives. And Wang could also find a strategic fit in Cordant. Both companies have business in the intelligence community, for example.

DynCorp chief executive Dan Bannister was out of the country last week and was unavailable for comment.

But a source familiar with the company's sales effort said Bear Stearns has created a "book" on DynCorp to provide a prospective buyer with a preliminary look at the company's business base and future prospects.

DynCorp's SEC filing noted that Bear Stearns has been authorized to discuss the acquisition of the company or parts of the company with potential buyers. This could open the door for spinning out the IT segment of DynCorp; other segments of the company deal with aerospace technology and facilities management.


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