Blog Coverage Booz Allen Hamilton Expands Government Business with Acquisition of eGov Holdings

Upcoming AWS Coverage on WageWorks Post-Earnings Results

LONDON, UK / ACCESSWIRE / November 30, 2016 / Active Wall St. blog coverage looks at the headline from Booz Allen Hamilton Holding Corp. (NYSE: BAH) as the company announced on November 29th, 2016, that it will be acquire the Laurel, MD-based digital services firm eGov Holdings, Inc. (Aquilent) a premiere architect of .gov solutions for the Federal government, where it deploys cutting-edge digital, agile, DevOps, and cloud capabilities. Booz Allen Hamilton has agreed to pay a purchase price of $250 million in connection with the transaction, subject to customary purchase price adjustments and customary escrows. Register with us now for your free membership and blog access at: http://www.activewallst.com/register/.

One of Booz Allen Hamilton Holding’s competitors within the Management Services space, WageWorks, Inc. (NYSE: WAGE), reported on November 09, 2016, its financial results for its third quarter ended September 30, 2016. AWS will be initiating a research report on WageWorks in the coming days.

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Transaction Details

Aquilent employs approximately 350 professionals who currently provide digital and cloud services for the U.S. Department of Health and Human Services, U.S. Postal Service (USPS), U.S. General Services Administration (GSA), and other federal clients. Aquilent has grown at a 28% compounded annual growth rate over the last five years. In 2016, Aquilent was ranked by Inc. as one of the 50 Best Workplaces in the U.S. and was named the 2015 Cloud Service Provider of the Year by Micro Trend.

Booz Allen Hamilton stated that the transaction will add technology capabilities and talent base to the company and will support its focus on building citizen-focused digital services. Upon closing of the transaction, eGov Holdings will be a wholly-owned subsidiary of Booz Allen Hamilton. The transaction is expected to close by December 31, 2016, and is subject to customary closing conditions. The acquisition will further expand Booz Allen Hamilton’s ability to blend its consulting heritage with advanced technical expertise to deliver to clients cloud, mobile and modular technology services using advanced methodologies such as Agile, DevOps, and open source. For the remainder of Booz Allen Hamilton’s fiscal year 2017, the transaction is expected to add approximately $30 million to $35 million of revenue. It is expected to be accretive to Booz Allen Hamilton’s earnings and to add to operating margin in fiscal year 2018.

“This acquisition further advances our long-term growth strategy,” said Horacio Rozanski, President and Chief Executive Officer of Booz Allen Hamilton, “We are driving sustainable quality growth through client solutions that blend technical capabilities and talent with our consulting heritage. This exciting addition to Booz Allen Hamilton will bolster our capacity to provide digital transformation to clients.”

Aquilent’s Chief Executive Officer David Fout said:

“Joining a firm like Booz Allen Hamilton, which aligns so closely with our expertise, offers the chance to expand into new areas of digital work, expands capabilities for our clients through the breadth of their relationships, and is a great opportunity for the people of Aquilent. We look forward to working together to support existing and future clients.”

The transaction adds to Booz Allen Hamilton’s Digital Game

Booz Allen Hamilton has continued to invest in technical capabilities in recent years as part of the company’s long-term growth strategy, called Vision 2020. In recent months, Booz Allen has won several large contracts for digital services, including a $25 million contract to support the GSA 18F to rapidly deploy tools and services that are easy to operate, cost-efficient and reusable across government agencies. Under this contract, Booz Allen Hamilton is primarily responsible for delivering digital services through agile development, user-centered design, and DevOps. The company also won a 7-year contract awarded by the USPS Enterprise Mobile Computing (EMC) IDIQ, which is one of the largest mobility contracts among public sector applications.

Stock Performance

On Tuesday, following the announcement, the stock closed the trading session at $38.20, climbing 2.69% from its previous closing price of $37.20. A total volume of 1.47 million shares have exchanged hands, which was higher than the 3-month average volume of 978.06 thousand shares. Booz Allen Hamilton Holding’s stock price advanced 25.83% in the last month, 25.51% in the past three months, and 31.60% in the previous six months. Furthermore, since the start of the year, shares of the company have gained 26.37%. The stock is trading at a PE ratio of 18.83 and has a dividend yield of 1.57%.

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