Perot Systems builds portfolio with QSS Group buy

Perot Systems has signed a definitive agreement to acquire QSS Group, a federal government information technology services company based in Lanham, Md., for $250 million in cash.

The announcement was made Monday after the stock markets closed at 4 p.m. According to the announcement, Perot Systems expects to complete QSS Group's integration activities during 2007.

Perot Systems expects QSS Group to achieve revenue of between $260 million and $280 million for 2007. The government services provider said it most likely would be able to close the acquisition in January and consolidate revenue for the balance of the year.

Perot Systems said the acquisition will strengthen its ability to grow within the federal services sector. Besides its workforce and government contracts, QSS brings some welcome expertise in the areas of information assurance and applications development and management.

The purchase of QSS Group will also expand the scope of services and the areas that Perot Systems serves within the Homeland Security and Defense departments, the company said.

When the acquisition is completed, Perot Systems Government Services will have a workforce of more than 3,400 serving the federal sector and is expected to report 2007 full year revenue of about $600 million.

QSS Group’s clients include the Army, Coast Guard, Department of Health and Human Services, NASA, the National Oceanic and Atmospheric Administration, the Treasury Department and the intelligence community. The company operates as the prime contractor on more than 90 percent of its contracts, according to the Perot Systems' announcement.

QSS Group’s current governmentwide acquisition contracts include the Homeland Security Department’s Enterprise Acquisition Gateway for Leading Edge Solutions (EAGLE), the Army’s Information Technology Enterprise Solutions, the Treasury’s Total Information Processing Support Services, and the General Service Administration’s Millennia Lite. QSS Group’s awards under EAGLE complements Perot Systems’ award.

“QSS and Perot Systems have complementary capabilities and very similar cultures, and I believe that together the two companies will produce a powerful government services growth engine,” said Frank Islam, chief executive officer of QSS Group, in the statement.

“QSS Group’s experience, client relationships and strong team of talented professionals are a perfect complement to Perot Systems Government Services’ team,” said Peter Altabef, president and CEO of Perot Systems. “With this acquisition, we will be even better positioned to support the important work of our government clients.”

“QSS is an excellent addition to Perot Systems and the synergies gained in this transaction will provide expanded growth opportunities for our federal unit,” said Jim Ballard, president of Perot Systems Government Services.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

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