Federal Services to acquire ATS

Federal Services Acquisition has agreed to acquire Advanced Technology Systems (ATS), a systems integrator based in McLean, Va.

The purchase price will consist of $84 million in cash and $1 million in stock, according to Federal Services. The deal also calls for up to $39 million in additional cash payments, which are contingent on ATS hitting targets for earnings before interest, taxes, depreciation and amortization. The deal is expected to close during the summer of 2006.

Federal Services is a special purpose acquisition corporation, a publicly traded company created to purchase companies in a given market segment. ATS, Federal Services’ initial acquisition, had revenue of $107.2 million for its fiscal year ending Oct. 31, 2005. The company provides systems integration, application development and consulting services to federal agencies. It employs more than 600 people.

Edward Bersoff, Federal Services’ vice chairman, will become chairman and chief executive officer of the combined companies upon completion of the transaction. Bersoff's previous integration role was as founder, president and chief executive officer of BTG. That company was sold to Titan in 2001.

In a conference call, Bersoff described ATS as an outstanding foundation on which to build. He said Federal Services will make additional acquisitions, but he added that his company has not yet made formal or informal commitments to other companies.


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