Volume 4 - AltAssets

Transcription

Q UARTERLY E XECUTIVE S UMMARY
OF
T HE L YNDHURST P ARTNERS R EVIEW
V OLUME 4, I SSUE 4
O CTOBER , 2006
M&A Transaction Statistics
Source: LPI7
Classification
Consulting
Solutions
Staffing
Offshore
Outsourcing
Total
Commercial
Government
Sept
13
4
1
1
6
25
24
1
3rdQ, 2006
Aug
July
9
18
2
0
1
0
2
3
8
7
22
28
20
27
2
1
3Q Deals by Geography9
Target
Number Percent
Mid Atlantic
4
5.3%
Midwest
6
8.0%
Northeast
16
21.3%
Northwest
4
5.3%
Rocky Mountains
2
2.7%
Southeast
13
17.3%
Southwest
8
10.7%
West
9
12.0%
International
13
17.3%
Total
75
100.0%
Total Sept
40
14
6
2
2
0
6
0
21
6
75
22
71
21
4
1
Quarterly Summary
3rdQ, 2005
Aug July
11
4
4
4
0
0
2
0
5
7
22
15
21
14
1
1
Total
29
10
0
2
18
59
56
3
Ma r k e t In d i c i e s : TTM P e r f o r m a n c e
Stock Market Performance: The
Dow Jones Industrial Average (DJIA),
The S&P 500 (S&P), and the NASDAQ
Computer Index (NCI) increased
4.4%, 4.9% and 7.2%, respectively,
during the third quarter of 2006.
12%
10%
8%
6%
4%
2%
0%
- 2%
- 4%
- 6%
- 8%
TTM
3Q 06
DJ IA
Source: Lyndhurst Partners, Inc.7
2Q 06
S &P 500
1Q 06
4Q 05
3Q 05
NS DQ Comp
Source: Market Indices
Summary of Public Comparables - 3Q 2006
Category
Consulting
Large
Medium
Small
Government
Large
Medium
Staffing
Large
Medium
Small
Offshore
Large
Medium
Outsourcing
Large
Medium
Infrstrctr/App Mngmt
EV / LTM Revenue
3Q '06
0.96
0.84
2.23
0.64
1.28
1.01
1.64
0.49
0.66
0.37
0.25
5.27
8.10
2.43
1.11
0.79
1.15
1.91
L YNDHURST P ARTNERS , I NC .
3Q '05
0.93
0.81
1.09
0.80
1.34
1.28
1.41
0.55
0.79
0.36
0.46
5.81
8.42
2.33
1.05
0.93
1.03
NM
M&A Activity: Lyndhurst Partners
identified a total of 75 ITPSO transactions for the third quarter of 2006.
This total equals the prior quarter (75)
and is a 27.1% increase from the same
quarter a year ago. In aggregate, transactional activity for the first three quarters of the current year increased
37.3% over the same 9-month period a
year ago (228 transactions in 2006 vs.
166 in 2005).
EV / LTM EBITDA
3Q '06
3Q '05
11.13
20.73
10.62
18.45
13.10
16.15
6.87
30.44
11.36
12.76
10.43
12.36
12.59
13.26
12.32
12.14
9.19
16.18
21.76
9.46
7.07
5.36
22.33
24.40
32.32
33.20
13.35
12.66
9.92
7.86
7.22
7.06
11.31
9.41
15.23
NM
704.332.4334
Rev.
Growth
Qtr (yoy)
16.2%
22.9%
17.7%
12.0%
18.2%
15.5%
20.9%
7.1%
9.7%
6.7%
-0.9%
42.8%
44.5%
41.0%
20.4%
3.6%
46.8%
30.0%
Market Metrics: During the third
quarter, the U.S. Department of Labor
continued to release positive news
related to both general levels of employment and employment specifically
within the IT sector. Additionally,
hiring projections for both temporary
and permanent IT positions remained
strong, and hourly wages for skilled IT
professionals continued to increase.
However, all was not positive. Concerns related to a reduction in both the
2007 Gross Domestic Product and
corporate profits placed a damper on
projected IT spending.
Lyndhurst Partners
Randall Snyder
Managing Director
[email protected]
1819 Lyndhurst Avenue
Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
www.lyndhurstpartners.com
WWW . LYNDHURSTPARTNERS . COM
T HE IT S ERVICES M&A Q UARTERLY
T HE L YNDHURST P ARTNERS R EVIEW
V OLUME 4, I SSUE 4
O CTOBER , 2006
T HE Q UARTER IN R EVIEW ….
A continuing increase in merger and acquisition (M&A) activity, encouraging
statistics related to both job growth and
employment opportunities in the IT sector, and rising wages for IT professionals
characterized the market for IT Professional Service Organizations (ITPSOs)
during the third quarter of 2006.
M&A Activity: Lyndhurst Partners
identified a total of 75 ITPSO transactions
for the third quarter of 2006. This total
equals the prior quarter (75) and is a
27.1% increase from the same quarter a
year ago. In aggregate, transactional activity for the first three quarters of the
current year increased 37.3% over the
same 9-month period a year ago (228
transactions in 2006 vs. 166 in 2005).
[Detailed quarterly transactional information begins on page 4.]
government (GOV) focused and 3 apiece
are centered on the Microsoft (MSFT)
and design / development (CRTV) sectors. Managed services (MSP) and managed security services (MSSP) constituted
38% (8 deals) of the Outsourcing transactions (3 of which were investments by
Private Equity Groups (PEGs)). Additionally, internet service (ISP) and hosting
(HSTG) providers accounted for 4 and 3
transactions, respectively. Consulting
transactions have led all classifications in
total transaction volume for each of the
last 16 quarters (the duration of the Lyndhurst Partners Review). In the current quarter, however, Consulting transactions
represented its lowest percentage of total
quarterly deal flow since the third quarter
of 2005 (49.2%). Conversely, the Offshore sector, buoyed by five acquisitions
overseas, accounted for its largest percentage of quarterly deal volume (6 transactions, 8.0%) since the second quarter
of 2005.
Lyndhurst Partners
Randall Snyder
Managing Director
[email protected]
Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
Fax: 704.332.4338
The S&P 500 (S&P), and the NASDAQ
Computer Index (NCI) increased 4.4%,
4.9% and 7.2%, respectively, during the
third quarter of 2006. During September
the DJIA flirted with its record high of
11,722.98 (January 14, 2000) before
closing the quarter at 11.679.07 (and
setting a new high on October 3), while
the S&P rose to a 5 ½ year high. Despite
the cooling of the housing market and
questions regarding the current inverted
yield curve (in which 90 day T-bills trade
higher than 10-year paper due to bond
investors anticipation of a slowing economy and a subsequent reduction in interest rates by the Fed)1 stocks rose due to
continued strength in the economy. This
M&A Statistics of Interest: Consulting and Outsourcing transactions comprised the majority of transactions with
40 (53.3%) and 21 (28.0%), respecGeographically, the Northeast again led
tively. Of the 40 Consulting transactions
the U.S. in total transaction volume
8 are network (NTWRK) related, 4 are
(based on announced targets) with 16
transactions (21.3%), 6 of which were in
2Q, 2006 M&A Deals by Geography9
Pennsylvania. The Southeast and the InGeography - Target Number Percent ternational community followed closely
Mid Atlantic
4
5.3% behind with 13 transactions apiece
(17.3%). Transactions involving internaContinued on next page.
Midwest
6
8.0% tional targets were spread across the
globe (3 in India, 2 apiece in Brazil, China I NSIDE THIS ISSUE :
Northeast
15
21.3% and England and one each in Russia, MaEndnotes
Northwest
4
5.3% laysia and Germany).
Rocky Mountains
2
Southeast
13
Southwest
8
West
9
International
Total
13
74
Forty-nine percent of the transactions
(37) included a public buyer (4 of which
17.3% were subsidiaries of public parents). Four
of the thirty-eight private buyers /inves10.7% tors were PEGs. Seven of the transac12.0% tions involved foreign buyers (9.3%).
Stock Market Performance: The
17.3%
Dow Jones Industrial Average (DJIA),
100.0%
2.7%
704.332.4334
3
3rd Q, 2006
Transactions
4
Quarterly Stock
Performance Analysis
9
Public Comparables
and Metrics
9
Notes to 3rd Q, 2006
Transactions
14
V OLUME 4, I SSUE 4
P AGE 2
T HE Q UARTER IN R EVIEW (C ONTINUED )….
M&A Transactional Statistics
7
Source: LPI
Classification
Consulting
Sept
3rdQ, 2006
Aug July
Total Sept
3rdQ, 2005
Aug July
Total
13
9
18
40
14
11
4
29
4
2
0
6
2
4
4
10
Staffing
1
1
0
2
0
0
0
0
Offshore
Outsourcing
1
6
2
8
3
7
6
21
0
6
2
5
0
7
2
18
Total
25
22
28
75
22
22
15
59
Commercial
24
20
27
71
21
21
14
56
Government
1
2
1
4
1
1
1
3
Solutions
was evidenced by sustained corporate
profits, reduced inflation fears (thanks in
large part to the reduction of oil and gas
prices – crude oil ended the quarter at
$62.95 per barrel, down 22% from the
summer high of $80.64)1, and the Fed’s
maintenance of the Federal Funds Rate.
Of the 63 publicly-traded ITPSOs followed by Lyndhurst Partners, 35 (56%)
experienced stock market gains during
the quarter. [Please see Financial and
Valuation Metrics of Public Comparables
beginning on page 9 for additional information.] Gainers included 8 of 17 in the
Consulting (commercial) sector, 6 of 8 in
the Consulting (Government) sector, 6 of
15 in the Staffing sector, 7 of 8 in the
Offshore sector and 8 of 15 in the Outsourcing sector. [NOTE: Please see chart
“Top 20 IT Software & Services Exporters from India (2005-2006)” for details on
the largest Indian offshore providers.]
Market Metrics: During the third
quarter, the U.S. Department of Labor
continued to release positive news related
to both general levels of employment and
employment specifically within the IT
sector. Additionally, hiring projections
for both temporary and permanent IT
positions remained strong, and hourly
wages for skilled IT professionals continued to increase. However, all was not
positive. Concerns related to a reduction
in both the 2007 Gross Domestic Product
and corporate profits placed a damper on
projected IT spending.
Un / Employment Statistics: Per the
U.S. Department of Labor’s Bureau of
Labor and Statistics, general unemployment remained flat in comparison to the
end of the prior quarter at 4.6% - the
lowest rate since May of 2001. The Bureau of Labor and Statistics also reported
that during the same period an additional
14,600 “Computer systems design and
related services” jobs were created. This
gain represents an increase of 61,300
position for the year and 168,800 jobs
since August of 2002 (the lowest point in
the last 6 years).
Hiring Projections: According to the
most recent Robert Half Technology IT Hiring Index and Skills Report (released September 20th), “Thirteen percent of chief
information officers (CIOs) polled plan to
add information technology staff in the
fourth quarter of 2006, and 3 percent
anticipate cutbacks.”2 Forty percent of
respondents cited business growth as the
driving factor for increased personnel.
[NOTE: The poll includes responses from
over 1,400 CIOs in companies with over
100 employees.] A new study released by
Aberdeen Group, The Contract Labor Cost
Management Benchmark Report, indicated
that over 50% of the companies surveyed
anticipate increasing its temporary staffing budget, with 12% of the firms expecting growth in excess of 10%. Per Aber-
deen, the IT department ranks as “the top
temporary staffing job category.3” (Per
the Bureau of Labor Statistics, IT staffing
employment is now above its 2001
peak.3)
Technology Wage Statistics: CIO Magazine’s latest Tech Poll4 indicated that “IT
compensation costs increased an average
of 4.9% in the 12 months ending September (2006).” Additionally, per the Yoh
Index of Technology Wages, wages for
highly-skilled tech workers increased
2.4% in the third quarter compared to
the same quarter a year ago. Jim Lanzalotto, Vice President of Strategy and
Marketing for Yoh, commented, “Wage
growth is steady, and all leading indicators point to increased hiring in coming
months, as well as continued demand for
high-impact technology skills. The outlook for the technology job market is very
positive.” Lanzalotto continued, “The
critical step for employers now will be to
develop an engaging employer brand and
desirable package of benefits to retain
Continued on next page.
Market Indicies: TTM Performance
12%
10%
8%
6%
4%
2%
0%
-2%
-4%
-6%
-8%
TTM 3Q 06 2Q 06 1Q 06 4Q 05 3Q 05
DJIA
S&P 500
NSDQ Comp
Index
9/30/06 6/30/06 3/31/06 12/31/05
DJIA 11,679 11,191 11,109
10,718
S&P 500 1,336 1,273 1,295
1,248
NSDQ Comp
990
924 1,004
992
Source: Market Indices
704.332.4334
V OLUME 4, I SSUE 4
P AGE 3
T HE Q UARTER IN R EVIEW (C ONTINUED )….
their key employees and
intellectual property, as
the opportunities for
movement increase.”
Technical ERP consultants
and SAP Functional consultants, both included in
the top 10 positions of
greatest demand, led the
list in regards to current
hourly pay rate. Lanzalotto suggested that the
future boded well for individuals qualified in the
ERP sector, “Talent should
also keep an eye on the
growing ERP space, and
look to develop the skills
most companies will need
in the next few years to
manage their ERP migrations.”
IT Spending: Per CIO
Magazine’s latest quarterly
Tech Poll4, projections related to IT spending increases (over the next 12
months) decreased from
6.9% in the second quarter
to 6.5% in the third quarter (the poll was conducted form September 7-14). Per this quarter’s Tech Poll,
almost 40% of respondents planned to
increase IT spending over the next 12
months (down from 43% in the prior
quarter). Respondents planning to decrease spending increased slightly to
13.8% (from 12.7% in the prior quarter). Storage systems ranked as the top
spending category with over 48% of respondents planning expenditures in this
category. Dr. Ed Yardeni, Chief Investment Strategist for Oak Associates commented, “Our latest poll suggest that tech
spending is likely to remain subdued over
the remainder of the year because corporate managers may be concerned about
weaker economic growth in 2007.”4
quarter, the Federal Open Market Committee (FOMC) provided this assessment
of the nation’s current financial situation
in its Minutes released September 20th,
“economic activity continued to decelerate in recent months. Consumer and business spending held up well, and payroll
employment continued to rise moderately in July and August. However, a contraction in homebuilding was damping the
economic expansion. Core consumer
price inflation eased somewhat but nonetheless remained higher than it was in
2005. Total consumer price inflation
moderated in August, reflecting a substantial slowing of the increase in energy
prices.”6 Based on this information the
FOMC held the Federal Funds Rate at
Federal Funds Rate: During the third 5.25%. In explaining its decision the Fed
704.332.4334
noted, “Readings on core inflation had
been elevated in recent months, and the
high levels of resource utilization and of
the prices of energy and other commodities had the potential to sustain inflation
pressures. However, inflation pressures
seemed likely to moderate over time,
reflecting contained inflation expectations
and the cumulative effects of monetary
policy actions, as well as reduced impetus
from higher energy and materials costs.”6
Indian Exchange Rate: The U.S. dollar
experienced modest depreciation against
the Indian rupee during the third quarter
of 2006, decreasing 0.2% (45.78 rupees
per dollar). Over the last 12 months,
however, the dollar has appreciated
4.13%.
~LPI
V OLUME 4, I SSUE 4
P AGE 4
IT S ERVICE T RANSACTIONS ( WITH M ETRICS ) — 3 RD Q, 2006 7
Date
Acquirer / Target
Ownership
Transaction Sales EBIDTA Sales EBITDA
Target
Consideration Geography Notes
Value (mil) (mil) (mil) Multiple Multiple Classification
CONSULTING & INTEGRATION - COMMERCIAL
7/21/06
Perficient / Energy, Government
and General Business div of DCSS
Public / Private
7/10/06 EFJ / 3e Technologies International Public / Private
12.9
17
N/A
0.76
N/A
CNSLT
Cash, Stock
TX,
Sugar Land
1
36
24
N/A
1.50
N/A
CNSLT WRLS (SCRTY)
Cash
MD,
Rockville
2
OUTSOURCING
9/11/06
Apptix / Mi8
Public / Private
21
6.45
N/A
3.26
N/A
OUT - MSP
Cash
NY,
New York
3
7/26/06
R Systems / WebConverse
Public / Private
10.7
5.1
N/A
2.10
N/A
OUT - HLP DSK
N/A
CA,
San Mateo
4
7/11/06
Iomega / CSCI
Public / Private
11.5
7.5
N/A
1.53
N/A
OUT - MSP
Cash, Stock
CA,
San Diego
5
SOLUTION
9/18/06
CDW /
Berbee Information Networks
Public / Private
175
390
22
0.45
7.95
SLTN - NTWRK
Cash
WI,
Madison
6
9/13/06
The Trizetto Group /
Quality Care Solutions
Public / Private
146.2
56.6
N/A
2.58
N/A
SLTN - HLTH
Cash, Assum
Debt, Earnout
AZ,
Phoenix
7
9/12/06
Incetra / Tactix
Public / Private
12
3.6
N/A
3.33
N/A
SLTN - STRG
Cash
OR,
Portland
8
DISCLAIMER: This information is obtained from sources believed to be reliable, but cannot be guaranteed to be completely accurate. The information is subject to change without notice.
E NDNOTES / S UPPLEMENTAL R EADING
1.
2.
3.
4.
5.
6.
7.
“Close But No Cigar,” by Lewis Walker, October 5, 2006, www.freemarketnews.com.
“Tech Hiring to Remain Steady in Fourth Quarter, CIO Survey Shows,” September 20, 2006, www.roberthalftechnology.com.
“Temporary Staffing Growth and Tight Labor Market Create New Challenges,” September 5th, 2006, www.aberdeen.com.
“IT Spending Projections Continue to Slide in September,” October 2, 2006, www.cio.com.
“Tech Wages Improving During Third Quarter, Yoh Index Reports,” October 11, 2006, www.yoh.com.
“Minutes of the Federal Open Market Committee,” September 20, 2006, www.federalreserve.gov.
Corporate press releases, quarterly filings an annual reports as prepared by the individual organizations associated with each individual statistic / transaction.
8. Completed by Lyndhurst Partners, Inc. and its professionals.
9. Rounded to the nearest tenth of a percentage.
10. FactSet Mergerstat.
T O R EPORT AN IT S ERVICE T RANSACTION P LEASE E MAIL US .
DEALS @ LYNDHURSTPARTNERS . COM .
V OLUME 4, I SSUE 4
P AGE 5
ITPSO T RANSACTIONS — 3 RD Q, 2006 7
Date
Acquirer / Target
Ownership
Target
Geography Notes
Classification
CONSULTING & INTEGRATION - COMMERCIAL
TRANSACTIONAL EXPERIENCE8
9/28/06
Incentra / allianceSoft
Public /
Private
CNSLT - NTWRK
MI,
Auburn Hills
9
9/27/06
Sun Microsystems / Neogent
Public /
Private
CNSLT - IDM
TX,
Austin
10
9/21/06
Dominion Enterprises / Advanced Access
Private /
Private
CNSLT - CRTV
CA,
Anaheim
11
9/20/06
AppLabs Technologies / IS Integration
Private /
Private
CNSLT - TEST
England,
Preston
12
9/20/06
Charles & John Rudd / SolutionsIQ
Private /
Private
CNSLT - STAF
WA,
Redmond
13
9/20/06
OnX Enterprise Solutions / Indigo27
Public /
Private
CNSLT - MSFT
Canada,
Ottawa
14
9/12/06
Tyler Technologies /
MUNIS business of Software Systems
Public /
Private
CNSLT - MUNIS
PA,
Gibsonia
15
9/6/06
IBM / Global Value Solutions
Public /
Private
CNSLT
Brazil,
Nova Lima
16
9/6/06
Logicalis Group / Computech Resources
Public /
Private
CNSLT - IBM
WI,
De Pere
17
9/6/06
Wunderman / Shaw Marketing Group
NY,
New York
18
9/1/06
NWN Corp / Xcelecom
Private /
Public (sub)
CNSLT
NC / NJ
19
9/1/06
Tribridge / Ideal Consulting
Private /
Private
CNSLT - MSFT
FL,
Tampa
20
8/31/06
aurionPro Solutions / Coban Corp
Public /
Private
8/18/06
Prolifics / Promenix
Private /
Private
8/17/06
Public (sub) /
CNSLT - CRTV
Private
Financial Advisory to the Seller
CNSLT CA,
CNTNT MNGMT San Francisco
21
PA,
Chadds Ford
22
CA,
Santa Clara
23
CNSLT - EAI
Private /
Clerity Solutions /
CNSLT - MGRTN
Mainframe Rehosting Business of Sun Microsystems Public (div)
8/16/06
Rand A Technology /
i-Vek Technology (Autodesk Business)
Public /
Private
CNSLT - AutoDesk
Malaysia,
Kuala Lumpur
24
8/9/06
Net@Work / Eagle Consulting
Private /
Private
CNSLT - SAGE
NY,
New York
25
8/8/06
GlobalSat / Virtue Technologies
Private /
Private
CNSLT NTWRK (SCRTY)
MD,
Rockville
26
8/1/06
Capital Growth Systems / 20/20 Technologies
Public /
Private
CNSLT - NTWRK
CA,
San Mateo
27
7/25/06
Ingres Corp / Thinking Instruments AG
Private /
Private
CNSLT - DATA
Germany,
Ilmenau
28
7/25/06
Neudesic / AVIVA
Private /
Private
CNSLT - MSFT
AZ,
Phoenix
29
7/25/06
Novacoast / eNvision Data Solutions
Private /
Private
CNSLT - IDM
PA,
West Chester
30
7/20/06
aurionPro Solutions /
Software Professional Service Corp.
Public /
Private
CNSLT - MBL
NJ,
Iselin
31
DISCLAIMER: This information is obtained from sources believed to be reliable, but cannot be guaranteed to be completely accurate.
The information is subject to change without notice.
Has been acquired by
has acquired
Financial Advisory to the Buyer
Lyndhurst Partners
Randall Snyder,
Managing Director
[email protected]
Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
Fax: 704.332.4338
V OLUME 4, I SSUE 4
P AGE 6
Date
OwnerTarget
Geography Notes
ship
Classification
Acquirer / Target
CONSULTING & INTEGRATION - COMMERCIAL (CONT)
7/18/06
FishNet Security /
True North Solutions (Commercial Business Unit)
Private /
Private
CNSLT - SCRTY
VA,
Herndon
32
7/14/06
Capital Growth Systems /
Global Capacity Group
Private /
Private
CNSLT NTWRK
TX,
Houston
33
7/11/06
Neoris / Konitech SA
Brazil,
Ibirapuera
34
7/10/06
Acumen / Database Solutions
Private /
Private
CNSLT NTWRK
SC,
Greenville
35
7/10/06
MTI Technology / Collective Technologies
Public /
Private
CNSLT - INFR
TX,
Austin
36
7/8/06
PEG / Incentra
PEG /
Public
CNSLT - STRG
CO,
Boulder
37
Private /
Private
CNSLT NTWRK
PA,
Allentown
38
Private /
Private
CNSLT NTWRK
VA,
Reston
39
WA,
Seattle
40
7/5/06
Public (sub) /
CNSLT - SAP
Private
Infradapt LLC /
McFadden Associates, LanXperts, Vital IT Solutions
has acquired
7/5/06
Solunet / iPath Technologies
7/5/06
Wunderman / ZAAZ, Inc.
7/1/06
Lumenate / Stonebridge Technologies
(Sun-related Infrastructure Business)
Private /
Private
CNSLT - STRG
TX,
Addison
41
7/1/06
Technology Integration Group /
Network Plus Technology Group
Private /
Private
CNSLT NTWRK
CA,
San Diego
42
CNSLT - GOV
NJ,
Mountain Lakes
43
Public (sub) /
CNSLT - CRTV
Private
CONSULTING & INTEGRATION - GOVERNMENT
9/29/06
Private /
Netstat-1 /
Computer Horizons Corp (RGII Technologies sub) Public (sub)
8/8/06
WFI / Madison Research Corp
Public /
Private
CNSLT - GOV
AL,
Huntsville
44
8/1/06
SAIC / bd Systems
Private /
Private
CNSLT - GOV
CA,
Torrance
45
7/12/06
MTC Technologies / Usfalcon
Public /
Private
CNSLT - GOV
GA,
Lowell
46
OFFSHORE
9/19/06
EPAM Systems / Vested Development
Private /
Private
OFSHR - AD
Russia,
Moscow
47
8/14/06
Oracle / i-flex Solutions
Public /
Public
OFSHR
India,
Mumbai
48
8/6/06 Achievo / Beijing BBX Information Technology
Private /
Private
OFSHR - AD
China,
Beijing
49
7/26/06
Public /
Private
OFSHR
India,
Bangalore
50
NJ,
Edison
51
China, Beijing
52
EDS / MphasiS
7/18/06 Alliance Consulting Group / Fusion Technologies
7/11/06
PEG / HiSoft Technology International
Public (sub) /
OFSHR - AD
Private
PEG /
Private
has acquired
OFSHR - AD
The information is subject to change without notice.
Lyndhurst Partners
Randall Snyder,
Managing Director
[email protected]
Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
Fax: 704.332.4338
V OLUME 4, I SSUE 4
P AGE 7
Date
OwnerTarget
Geography Notes
ship
Classification
Acquirer / Target
OUTSOURCING
9/20/06
SecureWorks / LURHQ
Private /
Private
OUT - MSSP
SC,
Myrtle Beach
53
9/12/06
AT&T / USi
Public /
Private
OUT - ASP
MD,
Annapolis
54
9/12/06
Verano / e-DMZ (MSSP Division)
Private /
Private
OUT - MSP
DE,
Wilmington
Enterprise Network
Systems
55
an operating company of
9/7/06
DST Systems / Amisys Synertech
Public /
Private
OUT - AD
(HLTH)
MD,
Rockville
56
9/5/06
Cognizant / AimNet Solutions
8/29/06
PEG / mindSHIFT Technologies
8/21/06
Telecity Redbus / Globix Holdings (UK)
8/17/06
Relational Technology Solutions /
AGT International (professional services group)
Private /
Private
OUT - AD
(TELCO)
OH,
Columbus
60
8/16/06 Coastal Technologies / BTI Business Continuity
Public /
Private
OUT - DATA
OH,
Cleveland
61
8/15/06
SeaWaves Technology / Colorteck Network
Private /
Private
OUT - HSTG
PA,
Morrisville
62
8/8/06
PEG / Microland
Private /
Private
OUT - MSP
India,
Bangalore
63
8/4/06
Advanticom / NetTec Services
Private /
Private
OUT - ISP
PA,
Pittsburgh
64
8/4/06
Peak 10 / RenTech
Private /
Private
OUT - HSTG
TN,
Brentwood
65
7/21/06
Computer Services /
Heartland Communications Internet Services
7/17/06
Pharos Capital Group / VeriCenter
7/12/06
US Technology Resources / QA Labs
Private /
Private
OUT - TEST
CA,
Vancouver
68
7/6/06
Synergetic Technologies / Quick Internet
Public /
Private
OUT - ISP
OR,
Portland
69
7/6/06
Synergetic Technologies / Net 3 Inc
Public /
Private
OUT - ISP
FL,
Boca Raton
70
SLTN - STRG
MO,
Earth City
Public /
Private
PEG /
Private
Private /
Public
Public /
Private
PEG /
Private
OUT - MSP
OUT - MSP
OUT - HSTG
OUT - ISP
OUT - MSP
CT,
Norwalk
VA,
Fairfax
NY,
New York
KY,
Paducah
TX,
Houston
57
Has merged with
58
59
Financial Advisory to Enterprise
Network Systems
66
67
SOLUTION
Has been acquired by
Financial Advisory to the Seller
9/28/06
ISG Technology / Blue Fusion Corp
Private /
Private
8/23/06
IBM / Internet Security Systems
Public /
Public
SLTN - SCRTY
8/3/06
Comtech Telecommunications Corp /
Insite Consulting
Public /
Private
SLTN - LGST
GA,
Atlanta
CO,
Colorado
Springs
71
72
73
STAFFING
9/5/06
Modis / Netlogic Limited
Public /
Private
STAF - NTWRK
England,
Shefford
74
8/9/06
SEGULA Technologies / Kenda Systems
Private /
Private
STAF
NH, Salem
75
Lyndhurst Partners
Randall Snyder,
Managing Director
[email protected]
Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
Fax: 704.332.4338
V OLUME 4, I SSUE 4
P AGE 8
LEGEND: CLASSIFICATION FOR TRANSACTIONS AND PUBLIC COMPARABLES
CNSLT Consulting and Integration
OFSHR Offshore
OTSRC Outsourcing
Primary Classification
SLTNS Solutions
STAFF Staffing
Vertical Market Classification
HLTH Healthcare
LEGL Legal
NRGY Energy
TLCO Telecommunications
TRSP Transportation
AUTO
DIST
EDUC
ENT
FS
GOV
Automotive
Distribution
Education
Enterprise
Financial Services
Government
AD
AM
ASP
BPO
BI
CC
CNTNT
CRM
CRTV
EAI
ENT
ERP
HSTG
Horizontal Market Classification
Application / Software Development
IDM Identity Management
Asset Management
INFR Infrastructure
Application Service Provider
LGST Logistics
Business Process Outsourcing
MGRTN Migration
Business Intelligence
MSFT Microsoft
Call Center
MSP Managed Service Provider
Content / Knowledge Management
MSSP Managed Security Provider
Customer Relationship Management
SCRT Security
Creative / Interactive
STRG Storage
Enterprise Application Integration
STGY Strategy
Enterprise
SCM Supply Chain Management
Enterprise Resource Planning
TRNG Training
Hosting
WRLS Wireless
D ISCLAIMER
The information and opinions
in this report were prepared by
Lyndhurst Partners, Inc. (“LPI”).
The information herein is
believed to be reliable, and was
obtained from public sources
believed to be reliable. However,
the information is subject to
change without notice and,
therefore, cannot be guaranteed
to be completely accurate.
Consequently, LPI makes no
representation as to the
accuracy or completeness of
such information. This report
is provided for informational
purposes only and should not
be construed as advice.
NOTE: SLTNS designates firms that provide IT services in conjunction with proprietary software products.
L YNDHURST P ARTNERS
For additional information on any of the
preceding transactions, the M&A
environment for Information Technology
Professional Service Organizations
(ITPSOs), or specific transactional
opportunities available for your
organization please contact Lyndhurst
Partners for discussion and analysis.
About Lyndhurst Partners: Lyndhurst Partners is a Mergers and
Acquisitions (M&A) consulting firm serving Information Technology professional service organizations, exclusively. With a North American focus
and global experience, Lyndhurst Partners provides M&A advisory, business valuation, business value consulting, and partnership development
services to consulting, offshore, outsourcing, and staffing service providers
in the Middle Market. Lyndhurst Partners is defined by six organizational characteristics. These characteristics, which distinguish us and
drive our corporate value proposition, include:
Singular Market Focus: We maintain a singular market focus.
Extensive Industry Knowledge: We deliver extensive industry knowledge.
Lyndhurst Partners
Randall Snyder
Managing Director
[email protected]
1819 Lyndhurst Avenue, Suite 203
Charlotte, NC 28203
Phone: 704.332.4334
Fax: 704.332.4338
Established Relational Infrastructure: We access an established relational
infrastructure.
Efficient Professional Process: We facilitate efficient professional processes.
Relevant Transactional Experience: We leverage relevant transactional
experience.
Consistent Exemplary Character: We employ consistent exemplary character.
Financial and Valuation Metrics of Public Comparables: 3rdQ, 2006
P AGE 9
CONSULTING AND INTEGRATION—COMMERCIAL
Corporate Information
($in millions except per share amounts)
Stock Information
Ticker Q**
Stock
Price 2nd Q 52-Week
(9/30) Change Change3
BE N/A
CBR 6/30
DTAS 6/30
7.86 -4.6%
3.6%
6.63 3.8% -10.8%
9.62 -14.6% -15.3%
Enterprise Value (EV)
Market
Cap
Total Total
(9/30) Cash+ Debt+
EV3
Revenue and EBITDA
EPS and P/E
Valuation Multiples
Qtrly
Qtrly
Rev
Earnings
Revenue* Growth EBITDA* EBITDA*% Growth
Diluted Trailing Forward
EPS*
P/E*
P/E1
Mkt
Cap / EV /
EV /
Rev* Rev* EBITDA*3
Revenue: $500 million plus
BearingPoint
Ciber
Digitas
Mean
Median
N/A
410
889
N/A
32
185
N/A N/A
213 590
0 704
N/A N/A
967 3.7%
660 42.1%
-5.1% -7.5%
-4.6% -10.8%
N/A
59.3
62.3
N/A
6.1%
9.4%
22.9%
22.9%
N/A
2.4%
13.6%
N/A
0.34
0.48
N/A
19.39
20.21
N/A
13.26
15.77
8.0%
8.0%
N/A N/A
0.43 0.61
1.34 1.07
N/A
9.96
11.29
0.89 0.84
0.89 0.84
10.62
10.62
Revenue: $100 - $500 million
Answerthink
ANSR 6/30
Covansys
CVNS 6/30
DiamondCluster International DTPI 6/30
2.69 -29.6% -30.8%
17.14 31.6%
11.14 38.6%
122
16
0
105
184 17.5%
12.5
6.8%
73.7%
(0.05)
N/A
11.70
0.65 0.57
8.39
7.4%
47.0%
628
369
115
73
0
0
514
296
449 8.5%
170 16.2%
54.9
24.1
12.2%
14.2%
-8.1%
N/A
0.89
(0.24)
19.37
N/A
14.78
29.32
1.43 1.14
2.16 1.74
9.35
12.29
First Consulting Group
Intelligroup
FCGI 6/30
ITIG.PK 6/30
9.75 9.3% 68.1%
1.40 -20.9% -34.0%
247
58
43
16
0
7
204
50
289 -3.7%
120 -6.3%
19.1
(3.5)
6.6%
-2.9%
N/A
N/A
(0.03)
(0.16)
N/A
N/A
14.77
N/A
0.88 0.71
0.47 0.41
10.70
N/A
Perficient
RCM Technologies
PRFT 6/30
RCMT 7/1
15.68 29.6% 89.6%
5.07 1.4% -15.6%
410
60
2
7
8
6
416
58
123 73.2%
186 5.8%
18.3
7.9
14.9%
4.3%
38.6%
59.1%
0.31
0.35
51.24
14.44
25.70
11.79
3.31 3.39
0.33 0.31
22.80
7.36
Sapient
SAPE 6/30
678
96
0
582
370 30.4%
28.0
7.6% 208.3%
0.19
28.33
22.67
1.82 1.57
20.82
1.38 1.23
1.16 0.93
13.10
10.70
5.44
Mean
Median
7.5% -13.0%
8.4%
8.4%
14.8%
-2.8%
17.7%
12.4%
74.3%
59.1%
5.70 -15.8%
19.2%
65
26
0
39
53 41.0%
3.4
6.5%
11.0%
0.17
33.33
22.80
1.23 0.74
11.42
18.11 38.6% 158.7%
4.13 -11.6% -1.4%
145
49
19
30
0
0
126
19
80 4.8%
43 -4.0%
(8.1)
3.2
-10.1%
7.5%
N/A
-7.5%
(1.96)
0.14
N/A
30.37
N/A
N/A
1.80 1.58
1.17 0.45
N/A
5.97
-4.1%
3.5%
22
9
13
2
0
0
9
7
44 24.0%
26 0.5%
(3.1)
2.2
-7.0%
8.5%
N/A
N/A
(4.92)
0.36
N/A
10.69
N/A
8.82
0.47 0.20
0.35 0.28
N/A
3.23
1.66 -21.3% -35.9%
60
42
0
17
31
(5.0)
-16.2%
N/A
(0.17)
N/A
N/A
1.85 0.56
N/A
Revenue: Less than $100 million
Edgewater
EDGW 6/30
eLoyalty
Inforte
ELOY 7/1
INFT 6/30
Technology Solutions Company
TSCC 6/30
TACX 6/30
The A Consulting Team
The Management Network Group TMNG 7/1
8.63 -9.0%
3.88 -7.6%
Mean
Median
5.8%
-4.5%
-10.3%
23.3%
1.1%
12.0%
5.3%
1.8%
1.8%
1.15 0.64
1.20 0.51
6.87
5.97
Consulting and Integration (Commercial) Mean
1.5%
13.9%
16.2%
43.5%
1.23 0.96
11.13
Consulting and Integration (Commercial) Median
# Gainers
# Losers
-4.6%
8
9
-1.4%
8
9
7.2%
14
3
13.6%
7
2
1.20 0.66
10.33
Data provided by Capital IQ (via Yahoo finance) unless otherwise noted.
* = Trailing Twelve Months
** = Information for quarter ending mm/dd/2006
+ = Most Recent Quarter
N/A = Not Available
DISCLAIMER: This information is obtained from sources believed to be reliable, but cannot be guaranteed to be completely accurate. The
information is subject to change without notice. The information herein is not sufficient for investment purposes and should not be so utilized.
704.332.4334
1 = Data provided by Thomson
2 = Data provided by EDGAR Online
3 = Data derived from multiple sources or calculated by Yahoo! Finance
4 = Data provided by Computershare
5 = Data provided by Hemscott Americas
P AGE 10
CONSULTING AND INTEGRATION—GOVERNMENT
Stock Information
Ticker Q**
Stock
Price 2nd Q 52-Week
Market
Cap
Total Total
(9/30) Cash+ Debt+
EV3
Revenue and EBITDA
EPS and P/E
Valuation Multiples
Qtrly
Qtrly
Rev
Earnings
Growth
Growth
Revenue* (yoy) EBITDA* EBITDA*% (yoy)
EPS*
P/E*
P/E1
Mkt
Cap / EV /
EV /
Rev* Rev* EBITDA*3
CACI International
ManTech International
Maximus
SRA International
CAI
MANT
MMS
SRX
6/30
6/30
6/30
6/30
55.01 -11.2% -9.2%
33.01 6.9% 25.0%
26.10 9.7% -27.0%
30.03 10.3% -15.4%
Mean
Median
1,690
1,110
562
1,680
25
3
170
183
368 2,030
28 1,130
4 396
0 1,500
1,760 11.1%
1,090 20.1%
696 7.5%
1,180 23.3%
3.9% -6.6%
8.3% -12.3%
199.2
104.2
44.2
128.0
11.3%
9.6%
6.3%
10.8%
15.5%
15.6%
0.6%
17.9%
N/A
9.9%
2.72
1.38
0.36
1.08
20.20
24.01
72.50
27.76
16.67
17.84
16.52
21.32
9.5%
9.9%
0.97
1.02
0.81
1.43
1.16
1.04
0.57
1.27
10.18
10.87
8.95
11.72
1.06 1.01
1.00 1.10
10.43
10.52
0.97 1.17
9.90
MTC Technologies
SI International
Tier Technologies
Tyler Technologies
MTCT 6/30
SINT
7/1
TIER.PK 12/31
TYL
6/30
24.04 -0.6% -24.8%
379
31.98
3.3%
412
6
6.80 17.2% -21.4%
133
65
500
22
N/A
2.7%
5
90
464
89
495
N/A N/A
181 13.8%
46.9
11.8%
3.1%
1.34
17.90
14.57
445 24.2%
43.1
9.7%
N/A 21.5%
N/A
N/A
10.1%
1.52
21.05
17.38
0.90 1.11
11.47
N/A
N/A
N/A
N/A
N/A N/A
N/A
29.1
16.1%
86.0%
0.27
47.19
30.07
12.93 16.0%
56.2%
2.75 2.64
16.41
Mean
Median
8.8%
9.3%
3.3%
-9.1%
20.9%
22.8%
33.1%
10.1%
1.54 1.64
0.97 1.17
12.59
11.47
Consulting and Integration (Government) Mean
6.4%
-1.7%
18.2%
21.3%
1.26 1.28
11.36
8.3% -12.3%
6
3
2
5
20.8%
8
0
10.0%
6
0
0.97 1.16
10.87
Consulting and Integration (Government) Median
# Gainers
# Losers
477
398 24.1%
N/A = Not Available
704.332.4334
P AGE 11
STAFFING
Stock Information
Ticker Q**
Stock
Price 2nd Q 52-Week
Market
Cap
Total Total
(9/30) Cash+ Debt+
EV3
Revenue and EBITDA
EPS and P/E
Valuation Multiples
Qtrly
Qtrly
Rev
Earnings
Growth
Growth
EPS*
P/E*
P/E1
Mkt
Cap / EV /
EV /
Rev* Rev* EBITDA*3
CDI Corporation
Comforce
Compuware
COMSYS IT Partners
CDI
CFS
CPWR
CITP
6/30
6/25
6/30
7/2
Kforce
KFRC 6/30
20.71
2.47
7.79
17.19
-29.9% -29.9%
-4.3% -7.8%
15.8% -18.0%
18.6% 40.8%
11.93 -22.9%
414
43
2,900
324
14
9
897
2
15.8%
484
1
MPS Group
MPS 6/30
15.11
1.1%
28.1%
1,560
130
Volt Information Sciences
VOL 7/30
35.55 -23.9%
75.0%
556
50
-6.5%
-4.3%
14.8%
15.8%
Mean
Median
4 404
99 148
0 2,010
136 459
57
40.8
19.0
217.2
42.3
868 18.1%
59.9
1,760 10.3%
124.8
7.1%
87.5
3.8%
540
0 1,430
24
1,200 9.8%
560 6.4%
1,200 -0.3%
701 15.7%
530
2,320
7.6%
3.4% 36.4%
3.4% 101.0%
18.1% 19.1%
6.0% 1458.6%
6.9%
9.7%
9.8%
0.89
0.22
0.38
0.85
23.24
11.18
20.29
20.22
14.69
N/A
16.57
13.98
0.35
0.08
2.39
0.47
0.34
0.26
1.67
0.65
9.90
7.76
9.23
10.84
0.68
17.67
12.30
0.58 0.62
9.03
45.0%
0.69
22.03
18.20
0.92 0.82
11.50
68.2%
1.64
21.66
19.43
0.24 0.23
6.06
0.72 0.66
0.47 0.62
9.19
9.23
47.6%
253.7%
47.6%
Analysts International
1.0% -20.4%
53
0
Butler International
BUTL.P N/A
ANLY 7/1
2.11
1.50 -28.6% -61.0%
N/A
N/A
6
58
N/A N/A
339 11.1%
N/A
N/A
3.0
0.9%
N/A
(0.59)
N/A
N/A
0.16 0.17
19.59
N/A
N/A
N/A
N/A
N/A
N/A
N/A N/A
N/A
51.26
Computer Horizons
CHRZ 6/30
4.00 -11.1%
-9.3%
132
36
0
96
260 -8.3%
1.9
0.7%
N/A
(1.88)
N/A
N/A
0.52 0.37
Computer Task Group
CTGX 6/30
3.98 -17.8%
7.6%
81
4
3
79
322 17.6%
8.8
2.7%
29.7%
0.17
23.14
13.72
0.25 0.25
8.98
National Technical Systems
NTSC 7/31
6.80
3.7%
36.8%
59
3
23
79
114
9.7% -47.2%
0.24
27.98
N/A
0.53 0.70
7.20
-10.6%
-11.1%
-9.3%
-9.3%
0.37 0.37
0.39 0.31
21.76
14.29
0.09 0.36
13.72
Mean
Median
6.3%
11.0
6.7%
8.7%
-8.8%
-8.8%
Revenue: Less than $100 million
enherent
ENHT. 6/30
0.07 -39.1% -53.3%
3
0
8
11
General Employment Enter-
JOB
6/30
1.69 14.2% -18.8%
9
6
0
3
TSR
TSRI 5/31
4.12 -7.1% -20.0%
19
8
0
11
Mean
Median
-10.7% -30.7%
-7.1% -20.0%
31
0.5%
0.8
2.6%
N/A
(0.01)
N/A
N/A
20
N/A
0.9
4.6%
54.4%
48 -2.2%
2.6
5.5%
N/A
0.18
9.13
N/A
0.42 0.16
3.39
0.27
15.51
N/A
0.39 0.22
4.09
-0.9%
-0.9%
54.4%
54.4%
0.30 0.25
0.39 0.22
7.07
4.09
Staffing Mean
-8.7%
-2.3%
7.1%
181.3%
0.53 0.49
12.32
Staffing Median
# Gainers
# Losers
-7.1%
6
9
-9.3%
6
9
7.6%
10
3
46.3%
10
0
0.41 0.35
9.13
N/A = Not Available
704.332.4334
P AGE 12
OFFSHORE
Stock Information
Ticker Q**
Stock
Price 2nd Q 52-Week
Market
Cap
Total Total
(9/30) Cash+ Debt+
EV3
Revenue and EBITDA
EPS and P/E
Valuation Multiples
Qtrly
Qtrly
Rev
Earnings
Growth
Growth
EPS*
P/E*
P/E1
Mkt
Cap / EV /
EV /
Rev* Rev* EBITDA*3
Cognizant
Infosys
Satyam
Wipro
CTSH
INFY
SAY
WIT
6/30
6/30
6/30
6/30
74.01 9.8% 58.9%
47.73 -36.3% -35.6%
38.69 16.2% 28.0%
13.25 5.2% 27.9%
Mean
Median
-1.3%
7.5%
19.8%
28.0%
20.56 42.7%
9.4%
13.35 23.6%
33.5%
10,430
26,430
6,310
18,970
468
278
749
881
0 9,960
0 26,150
26 5,590
16 18,110
1,110
2,300
1,150
2,500
59.1%
45.6%
36.3%
36.9%
252.0
729.0
270.2
621.3
22.7%
31.7%
23.5%
24.9%
44.5%
41.3%
52.8%
50.4%
86.2%
43.9%
1.35
1.07
1.67
0.34
54.9
44.61
23.17
38.97
37.76
29.28
21.49
27.04
58.3%
51.6%
9.48
11.54
5.50
7.51
8.94
11.36
4.86
7.24
39.53
35.87
20.69
29.15
8.51 8.10
8.50 8.09
31.31
32.51
Kanbay
KBAY 6/30
Ness Technologies
NSTC 6/30
Patni
Syntel
PTI
6/30
SYNT 6/30
19.06 31.5% N/A
824
70
97
851
300 85.6%
61.9
56
478
57
1,310
59
929
113
20.6%
1.5%
0.84
24.45
19.58
2.83 2.83
13.75
478
426 23.8%
39.7
9.3%
49.4%
0.70
19.18
13.09
1.10 1.12
12.04
1 1,260
503 36.9%
94.8
18.8%
N/A
0.61
31.25
15.88
2.60 2.50
13.24
0
249 17.8%
56.8
22.8%
14.1%
0.85
26.65
17.83
3.79 3.28
14.37
22.65 10.5%
16.2%
815
Mean
Median
27.1%
27.6%
19.7%
16.2%
41.0%
30.4%
21.7%
14.1%
2.58 2.43
2.72 2.67
13.35
13.49
Offshore Mean
12.9%
19.7%
42.8%
42.6%
5.54 5.27
22.33
Offshore Median
# Gainers
# Losers
13.3%
7
1
27.9%
6
1
36.9%
8
0
49.4%
7
0
4.65 4.07
17.53
N/A = Not Available
704.332.4334
P AGE 13
OUTSOURCING
Stock Information
Ticker Q**
Stock
Price 2nd Q 52-Week
Market
Cap
Total Total
(9/30) Cash+ Debt+
EV3
Revenue and EBITDA
EPS and P/E
Valuation Multiples
Qtrly
Qtrly
Rev
Earnings
Growth
Growth
EPS*
P/E*
P/E1
Mkt
Cap / EV /
EV /
Rev* Rev* EBITDA*3
Accenture
Affiliated Computer Services
CGI Group
Computer Sciences
Electronic Data Systems
ACN
ACS
GIB
CSC
EDS
8/31
6/30
6/30
6/30
6/30
31.36 11.6% 23.2%
51.86 0.3% -5.0%
6.55 3.0% -10.8%
49.12 -12.1%
3.8%
24.52 1.4%
9.3%
18,300
6,130
2,220
8,430
12,690
3,420
101
138
1,010
2,850
52 14,930
1,640 7,660
725 2,810
1,480 8,910
3,230 13,070
Keane
KEA 6/30
14.41 17.9%
26.1%
840
151
2.0%
85.7
Perot Systems
PER
6/30
13.79 -6.2%
-2.5%
1,640
251
77 1,470
2,150 17.2%
235.5
Unisys
UIS
6/30
5.66 -9.9% -14.8%
1,950
655
1,060 2,350
5,750 -2.0%
273.5
Mean
Median
0.8%
0.9%
150
18,230 1.9% 2,100.0
5,350 13.7%
876.4
3,160 -7.5%
458.3
14,590 -0.7% 2,170.0
20,290 3.9% 1,850.0
840
972
3.7%
0.6%
11.5% 51.2%
16.4% -21.7%
14.5% -41.2%
14.9%
N/A
9.1% 300.0%
1.59
2.90
0.39
2.38
0.47
19.96
17.90
16.75
20.63
52.39
15.78
13.23
11.91
11.53
18.44
1.00
1.16
0.71
0.58
0.62
33.5%
0.54
26.78
15.01
0.87 0.86
9.80
11.0% -20.7%
0.83
16.65
14.67
0.77 0.68
6.24
(5.50)
N/A
21.77
0.33 0.41
8.60
0.76 0.79
0.74 0.75
7.22
7.09
8.8%
4.8%
3.6%
2.0%
N/A
50.2%
6.4%
0.82
1.43
0.89
0.61
0.64
7.12
8.74
6.13
4.11
7.06
iGATE
IGTE 6/30
4.94 -22.2%
36.1%
262
76
0
186
276
2.1%
17.1
6.2%
N/A
0.12
39.84
19.76
0.98 0.68
10.88
Lionbridge Technologies
LIOX 6/30
7.63 38.0%
13.0%
456
29
87
514
366 167.4%
33.8
9.2% 116.6%
(0.06)
N/A
18.61
1.28 1.41
15.23
TechTeam Global
TEAM 6/30
7.86 -12.0% -34.9%
81
28
7
60
164 -3.3%
8.8
5.4%
N/A
0.24
32.48
13.79
0.50 0.37
6.78
Trizetto Group
TZIX 6/30
652
76
106
683
321 21.0%
55.3
17.2%
28.8%
0.56
26.84
21.63
2.01 2.13
12.36
1.19 1.15
1.13 1.05
11.31
11.62
1.80 2.52
20.79
15.14
Mean
Median
1.7%
7.2%
1.4%
-5.1%
5.4%
10.1%
46.8%
11.6%
72.7%
72.7%
Infrastructure and Application Management
Globix
GEX 6/30
Infocrossing
IFOX 6/30
Navisite
NAVI 7/31
4.65 -6.4% 136.0%
226
6
99
45.9%
290
17
3.63 -19.3% 188.1%
105
3
13.41 24.6%
Mean
Median
320
127 14.4%
15.4
12.1%
138
411
188 61.5%
28.4
15.1% 1472.6%
10
112
109 14.1%
10.7
-0.4% 123.4%
-6.4% 136.0%
9.8%
N/A
N/A
(0.44)
N/A
N/A
0.14
96.47
27.37
1.54 2.19
14.46
(0.49)
N/A
N/A
0.99 1.02
10.45
30.0%
14.4%
1472.6%
1472.6%
1.44 1.91
1.54 2.19
15.23
14.46
Outsourcing Mean
0.7%
28.1%
20.4%
213.2%
1.01 1.11
9.92
Outsourcing Median
# Gainers
# Losers
0.3%
8
7
9.3%
10
5
3.9%
11
4
33.5%
6
3
0.98 0.86
8.74
N/A = Not Available
704.332.4334
V OLUME 4, I SSUE 4
N OTES TO IT S ERVICE T RANSACTIONS 7
P AGE 14
A PPENDIX A
1. Perficient, Inc. (NASDAQ: PRFT), an information technology consulting firm serving Global 2000 and other large enterprise customers throughout
the United States, announced that it has acquired the Energy, Government and General Business (EGG) division of Digital Consulting & Software
Services, Inc. The acquired EGG division is a systems integration consulting business with approximately $17 million in annual revenues. Per the
asset purchase agreement, the consideration paid in the transaction is approximately $12.9 million excluding transaction costs, and includes $6.4
million in cash and approximately $6.5 million worth of Perficient common stock (based on the average closing price of Perficient's common stock
on the NASDAQ Global Select Market(TM) for the thirty trading days immediately preceding the acquisition close per the terms of the acquisition
agreement). The acquisition of EGG immediately increases Perficient's ability to deliver business-driven technology solutions to the market, adds
more than 100 consulting, technology, sales and support professionals, expands Perficient's national footprint into the Southeast, and adds client
relationships with enterprise customers including Shell, Cox Communications, US Navy, Northrup Grumman, Texas Children's Hospital, Eagle
Global Logistics, Chevron/Texaco, Schlumberger, Sysco, Reliant Energy and many others. The transaction is expected to increase Perficient's annualized revenues to greater than $170 million with more than 925 consulting, technology, sales and support professionals in 15 offices in the United
States and Canada and client relationships with more than 600 Global 2000 companies. The acquisition is expected to be accretive to earnings per
share immediately. The acquisition is the third this year and the eighth since 2004 for Perficient.
2. EFJ, Inc. (NASDAQ:EFJI) today announced that it acquired 3e Technologies International (3eTI), a privately held, Maryland based company. 3eTI
is a technology company that offers security solutions for wireless platforms such as WiFi, mesh networking and Bluetooth. 3eTI also develops and
sells secure wireless infrastructure that meet Federal Information Processing Standards, FIPS 140-2 validated 802.11i-compliant wireless networking
standards. 3eTI was founded in 1995 and currently has 95 employees located in U.S. and Taiwan. For the 12-month period ended May 31, 2006,
3eTI had revenues of approximately $24 million. EFJ, Inc. acquired 3eTI for cash of $36 million. The purchase price includes approximately $5.0
million to satisfy certain liabilities of 3eTI and approximately $3.6 million being held in escrow for potential indemnification claims. Certain 3eTI
employees are eligible to participate in bonus programs with payments to be earned based on achievement of performance objectives and continued
employment. EFJ, Inc. is financing the transaction with $21 million of cash and a $15 million term loan. The $15 million term loan is payable over 4
years and will be effected through an amendment and increase to EFJ's existing line of credit facilities with Bank of America. 3eTI was an Intel Capital portfolio company prior to this acquisition.
3. Apptix (OSE:APP), a provider of on-demand messaging and collaboration solutions for small and medium-sized businesses (SMBs), announced that
it has acquired Mi8 Corporation. Mi8 was profitable in the first half of 2006, generating $4.87 million in top line revenue and $4.61 million in recurring revenue during the period. During 2005, the company generated $6.45 million in top line revenue and $5.42 million in recurring revenue.
The total consideration for the acquisition is $21 million in cash. Of this, an initial payment of $19.43 million will be paid in cash at the time of closing. An additional amount of $1.67 million will be placed into an escrow account for a period of nine months from closing subject to the satisfaction
of all representations and warranties contained in the stock purchase agreement. The acquisition of Mi8, headquartered in New York and having
operations in Austin, Texas, establishes Apptix as the dominant provider of on-demand messaging and collaboration solutions to the SMB market.
The company presently has approximately 1,750 customers and 40,000 end users of Exchange. At the end of the second quarter, approximately
67% of users were from customers with more than 50 users. Founded in 1997, Mi8 was one of the first companies to offer Microsoft Exchange in
an on-demand model. Mi8 focuses on providing Hosted Exchange Services, along with complementary products including archiving, mobility and
advanced email defense services (virus protection, anti-spam and content filtering). Earlier this year, the company began offering a service based on
Hosted Windows SharePoint Services. Mi8 is ISO 9001:2000 certified and over the last several years has developed a reputation for operational and
customer service excellence. The combined entity will be a dominant market leader for Hosted Exchange with over 130,000 subscribers. The
acquisition will increase Apptix's pro forma top line revenue and monthly recurring revenue for the first half of 2006 to approximately $12.68 million and $12.03 million respectively, an increase of approximately 62.4% and 62.2% respectively. As a result of the transaction Apptix, founded in
1997, will expand into Europe via Mi8’s data center in the UK.
4. R Systems International Ltd. (NSE: RSystems) a leading provider of outsourced product development and customer support services announced that
it completed the acquisition of WebConverse. WebConverse is a technical support company with operations in Salt Lake City, US serving the high
technology sector with special focus on the growing mobile applications market. WebConverse, founded in 2000, achieved revenues of US$ 5.1
million in calendar year 2005. The estimated value of the transaction will be a maximum of $10.7 million inclusive of earn out payments.
5. Iomega Corporation (NYSE:IOM) , a global leader in data protection, today announced that it has reached a definitive agreement to acquire CSCI,
Inc., a San-Diego-based managed services and outsourced IT company that generated $7.5 million in revenue in 2005. CSCI, a profitable 20 year old
system integrator that began working on managed services in 2001, employs 21. Iomega paid a total of $11.5 million ($4.5 million in cash and $7.0
million in stock) and may pay up to $1.0 million in future cash payments, primarily for the purpose of retaining CSCI’s owners. The transaction
agreement provides for a portion of the transaction consideration, consisting of $0.6 million in cash and $0.6 million in shares of Iomega common
stock, to be held in escrow for 18 months following the transaction closing date, as partial security for the indemnification obligations of shareholders of CSCI to us. In addition, the agreement provides for an additional special $0.5 million escrow, half cash and half stock to be established for
certain matters if insurance coverage for those matters is not procured. Further, the two owners of CSCI have promised additional indemnity to
Iomega above the escrow amounts. Iomega has agreed to indemnify the shareholders of CSCI for breaches by us of our representations, warranties,
covenants and agreements in the merger agreement, on terms specified therein, for a total not to exceed $1.4 million. CSCI, which currently manages approximately 700 sites, was the 2006 winner of the Juniper Networks, Inc. "Managed Services Provider of the Year" award. Additionally,
CSCI is the creator of OfficeScreen(R) services, a suite of managed virtual private networks (VPNs) that provide small to medium-sized businesses
with secure wide-area networks that efficiently and economically link offices and remote workers. Iomega expects to grow the existing OfficeScreen business in the U.S. by selling its branded managed services through several different channels, including telecommunications providers,
V OLUME 4, I SSUE 4
P AGE 15
A PPENDIX A (C ONTINUED )
hosting companies, VARs and Systems Integrators, direct and indirect sales organizations and retail operations. By utilizing its strong European sales
infrastructure, Iomega plans to launch its new managed services in international markets before the end of 2006. According to independent market
analysis, the global market for managed security services is expected to be $2.9 billion in 2006, growing to $3.7 billion in 2008.
6. CDW Corporation (NASDAQ:CDWC), a provider of technology products and services to business, government and education, announced that it
has signed a definitive agreement to acquire privately-held Berbee Information Networks Corporation ("Berbee"), one of the nation's largest independent IT solution providers, for approximately $175 million in cash. For the trailing 12 months ended July 31, 2006, Berbee's revenue was $390
million and earnings before interest, taxes, depreciation and amortization was $22 million. Berbee has consistently grown revenue at strong doubledigit rates for the past five years. This acquisition will enhance CDW's offerings of advanced technology products and services to address customers'
more complex business requirements. In addition, the acquisition is consistent with CDW's strategies to expand its customer base, capture a greater
share of its customers' IT spending and increase its addressable market. CDW expects the transaction to be accretive to 2007 earnings by approximately $0.05 per diluted share. The acquisition is expected to close by the end of October, subject to certain customary closing conditions including
Hart-Scott-Rodino regulatory clearance. Berbee has an established track record of growth and profitability through the delivery of category-leading
services and IT products primarily across the Cisco, IBM and Microsoft platforms. Founded in 1993, Berbee is a partner to a broad spectrum of customers including corporate, healthcare, education and state and local governments. Areas of expertise include network infrastructure and unified
communications, systems and storage, security, productivity applications and managed services. Berbee is a national gold certified partner with
Cisco, a premier business partner with IBM authorized to sell all IBM server and storage lines and has six Microsoft gold certifications. Berbee received recognition as Cisco's U.S. IP Communications Partner of the Year in 2005, an IBM Beacon Award for Best IBM iSeries On Demand Solution
in 2006 and Microsoft Central Region Partner of the Year in 2006. Berbee's top three executive officers, including Chief Executive Officer Paul S.
Shain, have agreed to remain with and lead the business. Berbee will operate as a separate strategic business unit of CDW with its current product
and service offerings, management team, staffing, operations and locations. Based in Madison, Wisconsin, Berbee has 11 offices and two data centers
in six Midwestern states and employs approximately 800 people.
7. The TriZetto Group, Inc. (NASDAQ: TZIX) announced that it has signed a definitive agreement to acquire privately held QCSI (Quality Care Solutions, Inc.), which will bring together the two leading innovators of software and information technology solutions for the healthcare payer industry.
At closing, TriZetto expects to pay $133 million net of cash, and to assume $1.2 million of debt. In January 2008, contingent on certain factors,
TriZetto may pay an additional $12 million (on January 31, 2008) including a $7 million earn-out and a $5 million hold back. Although the company has sufficient cash resources to complete the transaction, TriZetto intends to finance a portion of the purchase price with proceeds from an
additional credit facility. For the trailing twelve months through July, 2006, QCSI generated revenue of $56.6 million and Adjusted EBITDA of
$9.6 million. Gross margin was 59% and Adjusted EBITDA margin was 17%. TriZetto anticipates that the acquisition will add $12 to $14 million of
revenue and $2 to $3 million of Adjusted EBITDA to the company's 2006 results. The transaction is expected to be mildly dilutive for 2006 earnings per share (EPS) and is projected to turn accretive in late 2007. Together, the companies' combined payment technology footprint of 115 million
health plan members in production will provide greater scale to accelerate and streamline the transformation of consumer retail healthcare, including
real-time point-of-service transaction capabilities and personal health records. Further, the merger creates the industry's broadest array of solution
choices for payers, addressing their scale, implementation speed and technology platform strategies. TriZetto is committed to continuing QCSI's
QNXT software system alongside its existing enterprise administration solutions. NOTE: Trizetto defines adjusted EBITDA as net income (loss),
excluding the impact of interest expense, income taxes, depreciation and amortization, charges for facilities closures and asset impairment, stockbased compensation expense and charges for expected future loss on contracts. It also excludes the company’s agreement to pay McKesson a onetime royalty fee of $15 million as a settlement to a patent lawsuit brought by McKesson.
8. Incentra Solutions, Inc. (BULLETIN BOARD: ICNS) , a provider of IT and storage management solutions to enterprises and managed service providers in North America and Europe, announced that it has acquired Portland, OR-based Tactix, Inc. for approximately $3.6 million in an all-cash
transaction ($2.8 million paid on the closing date, $360 thousand following the closing date – subject to reduction based on a working capital adjustment, and $452 thousand to Silcon Valley Bank as debt repayment) in a stock purchase agreement. Privately-held Tactix is Oregon's number one
reseller of Sun Microsystems(TM) products. It markets storage, networking and security solutions, as well as professional services to customers in
the enterprise, education, and local and state government markets. Tactix sales for the 12 months ended December 31, 2005 were approximately
$12 million. The acquisition of Tactix is expected to be immediately accretive and will add a staff of 23 professionals and more than 200 customers
to Incentra's existing operations. Tactix will become a wholly-owned subsidiary of Incentra Solutions and continue to operate from its offices in
Portland, Anchorage and Kirkland, WA. Brian Linse, the president of Tactix, will remain with the business and report directly to Incentra Solutions
President and Chief Operating Officer Shawn O'Grady.
9. Incentra Solutions, Inc. (OTCBB: ICNS), a provider of IT and storage management solutions to enterprises and managed service providers in North
America and Europe, announced that it has acquired Detroit, MI -based allianceSoft in an all asset purchase. Privately held allianceSoft is a small
solutions provider whose primary business is providing disaster recovery solutions to a large automotive business in the region. Craig Armstrong,
President of allianceSoft, will remain and report directly to Incentra Solutions’ President and Chief Operating Officer Shawn O’Grady. Incentra
Solutions Chairman and CEO Thomas P. Sweeney said that acquiring allianceSoft will strengthen Incentra’s presence in the Midwest and broaden its
disaster recovery offering with the proven solution allianceSoft has deployed successfully. Incentra provides allianceSoft a broader product & services set and an experienced engineering team to help go deeper into its existing key client base.
10. Sun Microsystems, Inc. (NASDAQ: SUNW) and Neogent, Inc. announced that they have entered into a definitive agreement pursuant to which Sun
will acquire Neogent, an identity management services automation company based in Austin, Texas. The combination of Sun's identity management
solutions with Neogent's deployment automation toolset will help Sun enterprise customers dramatically improve identity management implementa-
V OLUME 4, I SSUE 4
P AGE 16
tion times while reducing implementation costs, as well as better address compliance requirements for regulatory, security and privacy issues such as
the Sarbanes-Oxley Act, the Health Insurance Portability and Accountability Act (HIPAA), Homeland Security Presidential Directive-12 and the
Gramm-Leach-Bliley Act. The acquisition of Neogent will allow Sun to extend its leadership position across the identity management platform and
improve its ability to offer customers fixed-price and packaged identity management offerings that are repeatable and predictable with significantly
reduced deployment time.
11. Dominion Enterprises, a media and information services company, will acquire ADVANCED ACCESS, Anaheim, Calif., for an undisclosed cash
purchase price. With nearly 30,000 customers, ADVANCED ACCESS is a leading provider of web design, Internet marketing and hosting services
for real estate professionals in the United States. The company, founded in 1985, has annualized revenue of approximately $15 million and employs
130 people in Orange County. Dominion Enterprises has 6,600 employees nationwide and estimated 2006 annual revenue of $850 million.
12. IS Integration, a UK based IT and business solutions testing consultancy, announced its acquisition by AppLabs, a provider of testing services in the
US. Total consideration as part of the transaction is $37million, some of which is contingent on future profits. Together the merged businesses will
create the largest global provider of testing consultancy, with a combined staff base of approximately 1,500 employees and a forecasted $75 million
revenue and $8 million profit this fiscal year ending in March 2007. This news follows the June, 2006 announcement that AppLabs has received $10
million in funding from Sequoia Capital India. The investment in AppLabs totals $17 million, one of the largest investments Sequoia has made in an
Indian company. Under the scope of the AppLabs-IS Integration agreement all offices will continue to operate as they are and all staff will remain
employed in the UK based company. IS Integration, founded in 1994, will effectively form the European arm of AppLabs. The merged entity will
immediately employ approximately 1,500 people on three continents. Headquartered in Philadelphia, PA, USA, AppLabs employs 80 people in the
US, over 1100 in Hyderabad, India and around 300 are based across client sites in the UK. AppLabs has announced its aim to employ an additional
600 professionals by the year end to give a total staff base of over 2,000. AppLabs is looking to grow its operations in its current countries of presence, but also to expand globally, to include a pan-European presence. AppLabs is the first software testing company to get appraised at SEI CMMI
Level 5.
13. SolutionsIQ Inc., a provider of information technology services, staffing and consulting, today announced that after 27 years founders Doug Wright
and John Evans have sold the company to current chief operating officer, Charles Rudd and his brother John Rudd, principal at Newmarket Partners,
LLC. The sale will be effective Sept. 30, 2006. Co-founded in 1979 by Wright and Evans, SolutionsIQ provides a broad range of systems integration and development services that include consulting, project delivery, post-production support, staffing and best practices training. Originally
called CNA Computer Systems Engineering, the firm changed its name to SolutionsIQ in 1996. The 350-plus person firm has been a leader and
mainstay of technology services in the Pacific Northwest since 1979, providing a range of IT services to emerging companies, schools, colleges, state
and local governments and most leading Fortune 500s in the Puget Sound area. Customers include Microsoft, Starbucks, Amazon, Intel, Nike,
Nordstrom and Expedia. SolutionsIQ will continue to operate as usual from its Redmond offices.
14. OnX Enterprise Solutions Inc. (TSX: ON), a provider of IT services and Internet outsourcing solutions announced the acquisition of Indigo27 Inc. a
Business Solutions Consultancy firm based in Ottawa, Canada. “Indigo27 is a well-established organization in the Ottawa market with an impressive
client list and is recognized in the industry as a specialist in the delivery of Microsoft Business Productivity Solutions”, stated Sheldon Pollack, CEO
of OnX. “Together, OnX and Indigo27 are poised to deliver sophisticated business productivity solutions addressing critical client needs in the areas
of Enterprise Content Management, Collaboration, Business Intelligence and Enterprise Search”. This acquisition secures client access to the experience, resources and expertise required to ensure technology capabilities are aligned and optimized for priority business needs.
15. Tyler Technologies, Inc. (NYSE: TYL) announced that it has completed the acquisition of certain assets from Software Systems, Inc. (SSI) of Gibsonia, Pennsylvania. SSI has been a reseller of Tyler's MUNIS® financial software for more than 20 years and provided professional services and support to certain MUNIS users. Tyler acquired the assets associated with SSI's MUNIS-related business, including relationships with approximately 70
MUNIS users, primarily local governments in Pennsylvania. SSI's annual revenues from its MUNIS-related business were approximately $700,000.
Based in Dallas, Tyler Technologies is a leading provider of end-to-end information management solutions and services for local governments. Tyler
partners with clients to make local government more accessible to the public, more responsive to needs of citizens, and more efficient. Tyler's client
base includes more than 6,000 local government offices throughout all 50 states, Canada, Puerto Rico and the United Kingdom.
16. IBM (NYSE: IBM) has fully acquired Global Value Solutions SA, a Brazilian IT services provider serving the small and medium business market.
Since 2001, GVS has been a joint venture by IBM and Fiat, with each company holding a 50-percent stake. With this agreement, IBM acquires Fiat's
stake in the company as part of IBM's plan to grow and strengthen its presence in the Brazilian IT services market for SMB companies. IBM employs
about 9,000 people in Brazil, with roughly half of them in services. GVS is headquartered in Nova Lima, in the metropolitan region of Belo Horizonte. It is one of the five largest companies in the state of Minas Gerais, with about 400 employees in five locations. It provides system integration
and other IT services to clients in the automotive, automobile parts, metallurgy, finance, services and telecommunications industries.
17. Logicalis, a subsidiary of Datatec Limited (JNB:DTC) and a global provider of high-performance technology solutions, announced the acquisition of
Computech Resources, an IBM Premier Business Partner and a $35 million solution provider of IBM products and services, based in Green Bay,
Wisconsin. The acquisition strengthens Logicalis’ IBM solution capabilities and Midwest presence by adding 65 professionals, bringing its number of
employees to over 500 nationwide and increasing Logicalis US revenue to nearly $500 million. It also extends Logicalis’ capability to provide IBM
based solutions to the Small and Medium Business environment. Logicalis Group, which restructured its UK business earlier this year, performed
strongly in the last financial year with revenue excluding acquisitions rising 16% to $440.3 million and revenue including acquisitions growing to
$545.6 million. Logicalis’ earnings before interest, tax, depreciation and amortization nearly doubled to $16.7 million and it posted gross margins of
V OLUME 4, I SSUE 4
P AGE 17
20%. In May 2006 Datatec reported healthy results posting an 18% increase in revenue to $2.98 billion and achieving a nearly six-fold increase in
operating profit to $69 million. The company will become a wholly owned subsidiary of Logicalis, effective immediately. As an IBM Premier Business Partner, On Demand Accredited Business Partner and winner of several IBM Beacon and IBM Global Services Leadership awards, Computech
brings a leading staff of consultants and delivery experts that increase Logicalis’ presence in several major metropolitan markets including Green Bay,
Milwaukee, and Minneapolis. In addition, the acquisition strengthens Logicalis’ ability to provide service based solutions around IBM servers
(particularly System i), storage and software, giving Logicalis a more balanced distribution of sales and service expertise among its key product lines,
which include IBM, HP, Cisco and EMC. Logicalis is an international provider of integrated ICT solutions, delivering secure, converged computing
and communications infrastructure and services. The Logicalis Group is a division of Datatec Limited, a $3 billion business publicly listed on the
Johannesburg stock exchange. Datatec is an international networking and IT services company, with operations in many of the world's leading
economies. The group employs more than 3,000 information and communication technology professionals. With international headquarters in the
UK, the Group has operations in the US, UK, Germany, and South America.
18. Wunderman, a division of the WPP (NSDQ: WPPGY) network of advertising and digital marketing companies, announced the acquisition of Shaw
Marketing Group, a relationship marketing agency recognized for its expertise in Spirits, Consumer Packaged Goods and other nontransactional
product categories. The New York-based agency's current clients include Diageo (Crown Royal, Johnnie Walker, Smirnoff, Guinness and Baileys)
and the New York Philharmonic. Terms of the deal have not been disclosed. This new operating division of Wunderman New York will be called
Shaw Wunderman. Shaw Marketing Group was founded in 2002. Richard Shaw, founder and president of Shaw Marketing, will be the CEO of
Shaw Wunderman. All 20 Shaw Marketing Group employees will be retained.
19. UIL Holdings Corporation (NYSE: UIL) announced that its wholly owned subsidiary, Xcelecom Inc., a provider of specialty contracting and systems
integration services, has sold all of the outstanding shares of stock in its three Systems Integration companies to NWN Corporation, a Delaware
company headquartered in Waltham, Massachusetts. The sale price is $16.5 million, which is subject to certain post-closing adjustments. Included
in the sale price is an interest bearing promissory note in the amount of $4.0 million, of which $2.5 million is payable in August 2007 and $1.5 million is payable in August 2008. After transaction costs and income taxes, UIL will recognize a gain of approximately $2.4 million. The Systems
Integration companies are The Datastore, Inc. in New Jersey, 4Front Systems, Inc. in North Carolina and Datanet Services, Inc. (DSi) in North
Carolina. UIL Holdings, headquartered in New Haven, Connecticut, is the holding company for The United Illuminating Company, a regulated
utility providing electricity and energy related services to 320,000 customers in the Greater New Haven and Bridgeport areas.
20. Tribridge, Inc., a Microsoft consulting firm with offices across the southern U.S., acquired Ideal Consulting, Inc., a privately-held firm headquartered in Tampa. Tribridge also announces the expansion of its services in the Atlanta and Houston markets. Ideal, a Microsoft Gold Certified Partner, specializes in accounting, customer relationship management, collaboration and infrastructure solutions. Ideal’s 15 employees will join the
Tribridge staff. Founded in 1987 by Lance Raab, Ideal Consulting serves clients with Microsoft products including Microsoft Dynamics SL (formerly
Solomon), Microsoft Dynamics GP (formerly Great Plains), Microsoft SharePoint and Microsoft CRM. In addition, Ideal is a Business Objects Certified Crystal Reports Education Center, with training operations in Tampa and Orlando. Raab will not be joining Tribridge. Tribridge delivers
project-based services across the South with offices in Atlanta, Dallas, Houston, Miami, Orlando and Tampa.
21. AurionPro Solutions Ltd. (NSE: AURIONPRO, BSE: 532668) announced its intent to acquire 100% control in Coban Corporation (“Coban”),
based at San Francisco, in an all cash deal. A definitive agreement to conclude and consummate the transaction is expected to be signed within 45
days. Coban, with significant knowledge in the Enterprise Web technology space, specifically in Enterprise Portals, Enterprise Content, Document
and Records Management, Enterprise Collaboration, and various Enterprise integration Technologies, provides high end enterprise web technologies and enterprise integration technologies to Fortune 1000 clients. Coban services are group into two practice areas: 1) Vignette Technology
Practice and 2) Performance Assurance Management. aurionPro, which employs in excess of 400 people and is an ISO 9001:2000 certified company, is a technology product and solutions company, focused on Banking and Financial Services vertical (Cash Management, Treasury and Risk
Management solutions). Its cash management solutions today handle over 500,000 transactions daily clocking volumes of over $17 billion every
year. The Company is headquartered in Mumbai with subsidiaries in Singapore, Bahrain and USA. The company was founded in 1997.
22. Prolifics, a provider of IBM WebSphere, Portal, SOA, Security and Business Integration solutions, announced that it has acquired Promenix, Inc., a
leading systems integrator focused on SOA and EAI implementations. This acquisition will expand Prolifics’ SOA services practice as well as extend
its customer reach to the Mid-Atlantic with the addition of the Promenix office in the Greater Philadelphia area. Founded in 1978, Profilics is 1 of
only 3 WebSphere Service Providers retained by IBM.
23. Clerity Solutions, Inc. announced the acquisition of Sun Microsystems's mainframe rehosting business. On June 30, 2006, Clerity acquired the intellectual property assets and hired Sun employees (27) directly involved in the mainframe rehosting solution business. This assures support and product continuity for all current and future Sun rehosting customers worldwide. Effective immediately, Clerity will directly market and license the
online and batch application execution environments known as MTP (Mainframe Transaction Processing) and MBM (Mainframe Batch Manager)
software, as well as 3270 Pathway, mainframe migration tools, and associated services. Supported platforms include Sun Solaris, IBM AIX, HP-UX
and Linux. Clerity will continue its collaborative alliance with Sun and will work closely with their professional services group, sales, and support
teams around the globe. In addition to its existing partner network, Clerity will establish new relationships with Sun's partners who are involved in
the support of MTP/MBM. Clerity is a leading, full-service legacy transition company headquartered in Chicago, Illinois with offices worldwide.
Clerity has customers in all in major countries throughout the world, including some of the largest financial services ISVs and Fortune-class end
users. Clerity's migration team and automated software solutions have facilitated hundreds of legacy system migrations over the past 10 years. Clerity can architect, design and configure solutions; provide the software and hardware infrastructure, and support the operational aspects of the migra-
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tion from start-to-finish.
24. RAND Worldwide (TSX: RND) announced that it had entered into a Letter of Intent to acquire, through one of its subsidiaries, certain of the assets
and the Autodesk-related business of i-VEK Technology ("i-VEK"), located in Kuala Lumpur, Malaysia. The purchase price, payable by RAND for
the assets of i-VEK, will be made in cash and the transaction is expected to close in early October 2006. (NOTE: The transaction closed on October
4th.) i-VEK is a leading provider of Autodesk software and associated training, consulting and support services in Malaysia. As an exclusive Authorized System Center for Autodesk, i-VEK offers products and services for the manufacturing, and media & entertainment industries. “This transaction is a good strategic fit for RAND for several reasons,” said Frank Baldesarra, President and CEO of RAND Worldwide. “First, it supports our
continued efforts to drive growth in our rapidly expanding IMAGINiT business. Second, i-VEK has a proven track record and a solid foothold in the
Malaysian market, which further extends our international base and better positions us to serve our global customers. And finally, i-VEK’s team has
extensive CAD and IT experience in the Autodesk environment and will be a strong addition to our IMAGINiT Asia-Pacific group.”
25. Net@Work, a provider of integrated business technology solutions, and a 2006 Sage Software Top Business Partner for both the MAS and ACCPAC
product lines, announced that it has expanded its Sage MAS practice with the purchase of Eagle Consulting Group, a top Sage Software MAS 90 and
MAS 500 reseller in the Tri-State area (New York, New Jersey, and Connecticut). The acquisition bolsters Net@Work's MAS practice and provides
Eagle's 200+ customer base with a range of core services geared to supporting small and medium-sized businesses (infrastructure services, software
upgrades, web services, ecommerce systems, document management, and CRM rollouts). Eagle's founder and CEO, Debra Ellis will serve as Manager of Consulting Services; she will be joined by Eagle's MAS consulting team, significantly adding to Net@Work's MAS expertise. Founded in
1994, Eagle provides MAS 90/200/500 accounting software solutions and consulting services to small and mid-sized businesses. The acquisition will
firm up Net@Work's MAS practice, further enhancing its standing as the region's leading reseller of business technology solutions. Net@Work will
give Eagle's clients immediate access to a range of services beyond MAS support, including Network Infrastructure and Support, Information Security and Compliance Consulting, Web Development, Document Management, and CRM-as well as a guaranteed 4-hour support response time.
26. Satellite communications provider GlobalSat Telecommunications has acquired Virtue Technologies, a network security company, for an undisclosed amount. Virtue Technologies maintains a Top Secret Facility Clearance, is a GSA schedule holder, a Cisco Premier Partner, an Advanced
Technology Partner for Security, and was recently awarded Cisco System’s highest level of VoIP specialization; the Advanced Unified Communications Specialization. Both companies are privately held Maryland businesses. GlobalSat is based in Laurel, and Virtue has its headquarters in Rockville. The acquisition adds 14 network engineers to GlobalSat’s staff. GlobalSat says the merger combines its satellite communications network with
Virtue's expertise in designing, implementing and supporting security technologies. GlobalSat, a subsidiary of South Jordan, Utah-based Lyman
Bros., serves both government and commercial customers with coverage throughout South America, Europe, Africa and the U.S.
27. Capital Growth Systems, Inc. (OTCBB:CGSY), announced that it has signed a letter of intent to acquire 20/20 Technologies Inc., the holding company whose assets include 100 percent ownership of U.K.-based Magenta netLogic, Ltd. - a global leader in circuit pricing and network optimization. The planned transaction contemplates a purchase consideration of a mix of cash and shares, and represents part of CGSY's current strategic
program of expansion through acquisition to become a leading telecom service provider with international capabilities. 20/20 Technologies, Inc. is
a network integration and information company that focuses primarily on providing full service assistance to clients in optimizing their telecommunications networks and also provides clients, on a global basis, accurate market information regarding circuit pricing and design via its proprietary
databases and analytical capabilities. 20/20 Technologies operates primarily through its U.K. subsidiary, Magenta netLogic, Ltd. Terms of the transaction are as follows: On July 28, 2006, Capital Growth Systems, Inc. (“CGSY”) entered into a Purchase Agreement with Augustine Fund, L.P., an
Illinois limited partnership, Michael Balkin and David Lies (each of Balkin and Lies, also a “Guarantor”). Augustine was the holder of promissory
notes issued by 20/20 Technologies, Inc. in the aggregate original principal amount of $1,600,000. Additionally, Augustine held warrants to purchase equity securities of 20/20 Inc. Pursuant to the Agreement, the Guarantors agreed to purchase a portion of the Notes and 20/20 Warrants and
CGSY agreed to purchase the balance of the Notes and 20/20 Warrants for a payment of $1,000,000.00, due on August 31, 2006. On July 28,
2006, CGSY also entered into that certain Agreement with the Guarantors pursuant to which each of the Guarantors agreed to guarantee the payment by CGSY to Augustine of the $1,000,000 purchase price for the CGSY Notes and CGSY Warrant as set forth in the Purchase Agreement. In
consideration of such guaranty, CGSY granted each Guarantor a warrant to purchase 500,000 shares of common stock of CGSY.
28. In its first acquisition since emerging as an independent company in November 2005, Ingres Corporation, an open source database company, today
announced its acquisition of Thinking Instruments AG, a Ingres services provider and reseller headquartered in Ilmenau, Germany. With the acquisition of Thinking Instruments, Ingres immediately broadens its global reach in the important business markets of Germany and the Middle East, as
well as expands its revenue base in a profitable manner. Financial terms of the deal were not disclosed.
29. Neudesic, premier provider of Microsoft solutions in the information technology industry, and AVIVA Consulting Group, Inc., a provider of collaboration solutions built on the Microsoft platform, announce the completion of a merger of the two privately-held companies which will operate
under the Neudesic name. As both companies are trusted partners of Microsoft, Neudesic and AVIVA saw an opportunity to join forces in order to
provide more encompassing Microsoft solutions to their clients. AVIVA's strength in compliance solutions coupled with Neudesic's expertise across
Microsoft's robust technology platform will provide customers a complete and totally integrated set of solutions. Furthering Neudesic's strength in
the marketplace, this merger represents yet another strategic move to meet the demand for expertise in the Microsoft Information Worker space.
AVIVA brings a talented technical team, a solid product suite and numerous customer relationships that offer a compliment to Neudesic. The corporate headquarters will remain in the Neudesic headquarters located in Irvine, CA. In order to ramp up the synergies of the combination quickly, the
companies have also combined offices in the Phoenix and Los Angeles locations.
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30. Novacoast, Inc., an IT professional services firm announced its acquisition of eNvision Data Solutions, LLC. eNvision, a systems integrator and
Novell Platinum Partner headquarted in Philadelphia, has served Pennsylvania and New Jersey since 2001. eNvision's core competence is in identity
management, Linux, and Open Enterprise Server. All eNvision staff will be retained by Novacoast as the two operations are merged.
31. aurionPro Solutions (NSE: AURIONPRO, BSE: 532668) has signed an Memorandum of Understanding to acquire SPS Corporation. SPS generated
$9.2 million in revenue for the trailing twelve months, ending March, 2006 and is profitable. The company employs 93 people. As per the terms of
this MOU, the acquisition would be funded through a mix of cash and stock. Commenting on this deal Mr. Amit Sheth, Managing Director, stated,
“This acquisition will help achieve the size and scale to launch aurioPro’s banking suite in the US market next year and elevate company into a position to compete for major contracts globally with fortune 1000 clients besides opening up off shoring opportunities with SPS’s current clients”
32. FishNet Security announced that it had acquired True North Solution’s Commercial Sales and Professional Services Division. True North Solutions’
Commercial business unit, including information security product sales, training, support, and consulting services, is joining FishNet Security to
create the largest Information Security integrator in the United States. With FishNet Security’s recent acquisition of California-based SiegeWorks,
and now True North Solutions’ Commercial, the company will have more than 200 associates, 25 offices and nearly $200 Million in revenue. True
North Solutions (True North) helps clients manage information security risks through comprehensive and ongoing information security consulting,
design, implementation, assessment, training and support. Headquartered in Northern Virginia’s Technology Corridor, True North has offices
throughout the Mid-Atlantic and Mid-Western regions of the United States.
33. Capital Growth Systems, Inc. (OTCBB:CGSY), announced it has signed a letter of intent to purchase 100 percent of the common stock of Houstonbased Global Capacity Group, Inc. (GCG), network-neutral bandwidth logistics experts providing network integration and wholesale network services to both carriers and large enterprise customers. Terms of the transaction, which is expected to close in the third quarter, were undisclosed.
The transaction is expected to be accretive to CGSY in the first year of integration.
34. Neoris, a subsidiary of CEMEX (NYSE: CX) and a business and information technology global consulting firm with a leadership position in Latin
America, announced an agreement with Konitech, a Brazilian company with experience in SAP-xMII™ (Manufacturing Integration and Intelligence)
for the absorption of its intellectual capital, in effect consolidating its MES (Manufacturing Execution Systems) practice in the Americas. Konitech is
the official partner of SAP for the implementation of manufacturing solutions and the first Latin American company certified in the innovative SAP
tools xApp™ for xMII™. xMII™ benefits the business community by complementing mySAP Business Suite and SAP Netweaver™, SAP’s business integration platform, and solutions designed for competitiveness management, Six Sigma, SPC/SQC, and others. This strategy supports Neoris’ continuous growth and corresponds to the strategic alliance it has with SAP Americas, Inc., a subsidiary of SAP AG (NYSE:SAP). The objective
is to offer adaptable solutions for logistics and manufacturing execution. This initiative strengthens Neoris’ capacity in manufacturing by expanding
its staff of professionals with experience in xMII™ in the Americas. It also strengthens Neoris’ position as a technology innovation leader in the region since this technology provides an advanced framework for systems integration that reduces the total cost of ownership (TCO).
35. Acumen, a privately-held professional technology firm founded in 1999 and located in Greenville, South Carolina, announced that they have signed
an agreement to acquire Database Solutions, a network and software consulting, implementation, and support company. This is Acumen's second
acquisition in less than 5 months. Located in Greenville, S.C., Database Solutions specializes in customized accounting and Great Plains and Microsoft Dynamics Customer Relationship Management (CRM) systems. CRM applications for upstate customers include hospitals and manufacturing
companies. They have had a working relationship with Acumen for more that 5 years. In March, Acumen acquired Complete Computer Services of
Jacksonville, Florida. That acquisition allowed Acumen to become a Microsoft Business Solutions Partner for Microsoft Dynamics Great Plains,
Microsoft Customer Relationship Management (CRM) and Microsoft Retail Management Systems (RMS). The purchase of Database Solutions further enhances Acumen's expertise in these areas.
36. MTI Technology Corporation (NASDAQ:MTIC) , a multi-national information and infrastructure solutions provider, announced it has completed
its acquisition of the assets of Collective Technologies, a provider of enterprise-class IT infrastructure services and solutions, with over 90 consultants. On June 6, 2006, the Company entered into an Asset Purchase Agreement with Collective Technologies, LLC and effective July 2, 2006, the
acquisition was closed. Pursuant to the Asset Purchase Agreement, the Company acquired specified assets and liabilities of Collective for a purchase
price consisting of: $6,000 in cash, a note in the amount of $2,000 bearing interest at 5% and due in twelve quarterly payments beginning 90 days
after closing, 2,272,727 shares of the Company’s common stock, a warrant to purchase 1,000,000 shares of the Company’s common stock at an
exercise price of $1.32 per share and the assumption of certain liabilities. The shares issued as consideration in the transaction are subject to a
12 month lock-up agreement and have piggyback registration rights. The purchase price is subject to certain adjustments specified in the Asset Purchase Agreement. The Company will also issue up to 306,303 shares of restricted stock and up to 1,608,481 stock options to former employees of
Collective that it acquired in the transaction, or increase the purchase price in lieu thereof in certain instances. As a result of this acquisition, MTI
customers will now be able to take advantage of an expanded solutions and services portfolio, which includes: Business Continuity (Disaster Recovery and Back-up and Recovery), Virtualization Technology, Infrastructure Consolidation and Migration, Mail & Messaging, High Density Computing, Data Storage Solutions and Assessments, Systems Management, Data Management, Migration & Consolidation. MTI will operate Collective as
a division of MTI, headquartered in Austin, Texas.
37. Incentra Solutions, Inc. (BULLETIN BOARD: ICNS) , a provider of complete IT and storage management solutions to enterprises, managed service
providers and broadcasters worldwide, announced that is has received $1.4 million from three institutional investors in additional closings in the
short-term convertible note financing announced in late May of this year. In connection with the financing the Company also issued warrants to the
institutional investors to purchase 320,000 shares of common stock at $1.40 per share. The initial closing of $1.0 million was led by one of Incen-
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tra's directors, members of senior management and other insiders. The amount raised in the financing to date, including an additional investment by
a Company insider, totals $2.4 million, all of which will be used to fund the Company's operations. Chairman and CEO Thomas P. Sweeney said
that the institutional investors participating in the latest closings include two funds of London-based RAB Capital, a current shareholder who had
previously purchased the Company's common stock in open market transactions, and Blueline Partners LLC located in Danville, CA.
38. LanXperts, Inc. of Allentown, Vital IT Solutions Inc. of Exton, and McFadden Associates Inc. of Philadelphia and Easton today announce their
merger and consolidation of operations to form Infradapt LLC. The combination of the three firms creates a service organization with resources
capable of serving firms throughout the region. Presently supporting more than 12,000 users, Infradapt’s focus includes: Technology and network
support (departmental outsourcing), 24-Hour Call Center to solve computer support needs, Advanced telephone systems and Voice Over Internet
Protocol (VoIP) technologies, and Security and Regulatory Compliance Assessments including HIPAA, SOX, GLBA, CISP (Visa/MasterCard).
39. Solunet, a value-added network solutions provider to Tier II and III telecommunications, ISP, and enterprise customers, announced the acquisition
of iPath Technologies, Inc., a value-added network solutions provider of educational and professional services and product re-sales of best-of-breed
solutions to internet service providers ("ISP"), enterprise clients, and government. iPath focuses on high-end security, routing, and carrier grade
Voice over IP ("VoIP") training of Juniper Networks products and high-end design, engineering, and integration services. Terms of the acquisition
were not disclosed. Commenting on the transaction, Philip O'Reilly, CEO, Solunet, Inc., stated, "Our acquisition of iPath gives Solunet a depth
and sophistication in engineering services virtually unrivaled by any other IT Solutions Provider. This is a major enhancement to the substantial professional services we already offer to our customers." Solunet is a portfolio company of Sun Capital Partners, a private investment firm specializing
in leveraged buyouts and investments in market-leading companies. Sun Capital affiliates have invested in and managed more than 120 companies
worldwide with combined sales in excess of $30.0 billion since Sun Capital's inception in 1995.
40. Wunderman, a division of WPP Group's (NSDQ: WPPGY) network of advertising and marketing companies, announced the acquisition of ZAAZ,
an interactive agency recognized for its award-winning creative and leading Web analytics consulting practice with offices in Seattle and Portland.
The company did not disclose exact terms of the deal, but said ZAAZ held net assets of $1.6 million at the end of 2005, and generated $9.2 million
in unaudited revenue. ZAAZ, with 65 employees, offers a comprehensive range of services including Web strategy, design, development, user
experience, Web analysis, search marketing and optimization, with a keen focus on delivering measurable results in the digital world for leading
brands and Fortune 1000 companies. ZAAZ was founded in 1998 and is led by Shane Atchison, CEO, and Dave Brede, COO, each of whom have
10+ years experience in strategic consulting, business development and executive management in Web marketing, design and branding. Clients
include Microsoft, Converse, Helio, E*Trade, Qwest, Intel, Alcoa, Blockbuster, Expedia, Reuters, Faconnable, National Geographic and others.
41. Lumenate, a technology consulting firm in the South-Central U.S. specializing in storage and business continuity, announced the acquisition of Dallas-based information technology (IT) consulting firm Stonebridge’s Sun-related Infrastructure business. The acquisition of Stonebridge’s Sunrelated infrastructure business complements Lumenate’s capabilities by capitalizing on the combined team’s compute capabilities in the data center
environment. The acquisition creates the area’s largest technology consulting company focused on Storage and Business Continuity. As a result of
the acquisition, Lumenate will double its customer base and its sales force in Texas and Oklahoma. Lumenate, headquartered in Dallas, Texas, with
offices in Oklahoma City and Houston, will expand its operation to Central Texas (Austin and San Antonio) and Tulsa, Oklahoma. Stonebridge has
approximately 100 employees.
42. San Diego-based Technology Integration Group (TIG) announced the acquisition of Networks Plus Technology Group (NPTG), a San Diego-based
consultancy / reseller with $11-12 million in revenue. NPTG, a privately held 12-year old firm, provides services in network security, network
storage, and network management, as well as CRM and IT staffing. Clients include UC San Diego, Rubio’s Restaurants and Petco Park. Approximately 20 NPTG employees will join TIG not including Jim Kernan, NPTG’s CEO. TIG maintains 19 offices in the US and provides services to
SMB and enterprise clients in the commercial sector. The Company holds a GSA schedule and services government clients as well. TIG generated
$284.5 million in 2005.
43. NetStar-1, an information technology provider and solutions integrator headquartered in Rockville MD, announced that it has purchased the Federal
government consulting services subsidiary of Computer Horizons Corp. (NASDAQ: CHRZ), RGII Technologies, Inc., a strategic solutions and
professional services company. The transaction is valued at $15.3 million in cash. The combined companies, NetStar-1 and RGII, will have approximately $100 million in revenue with over 500 employees, serving numerous Government and commercial clients across the United States. NetStar1 provides technology services, specializing in providing IT solutions to government and industry. NetStar-1 provides consulting, design and implementation services in four key areas – Network Infrastructure, Applications Development, Security and Server/Storage technologies. RGII Technologies, Inc. is a solutions provider of high-end technology and program management to Federal, state and local government agencies. The company's solutions and services capabilities include enterprise management, network infrastructure, information assurance and security, web development and integration, program management, call management, engineering technology and technical services. The firm has contracts with over 80
government customers, including the Department of State, the Department of Defense and the Department of Commerce.
44. WFI (NASDAQ:WFII) , a leader in the design, deployment, and management of wireless communication networks, information technology solutions and security systems, announced that is has entered into a definitive agreement to acquire Madison Research Corporation (MRC), a privatelyheld technical solutions and services company focused on advanced telecommunications programs, software and IT solutions, product solutions and
space programs. The acquisition of MRC significantly advances WFI's customer footprint within the U.S. Department of Defense with key customers including the U.S. Army, U.S. Air Force and NASA. MRC is headquartered in Huntsville, Alabama, and has approximately 375 personnel located in 15 states who support over 85 contracts and tasks for 15 U.S. government customers and 10 foreign nations. The transaction is valued at
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approximately $69 million, subject to certain post-closing adjustments, and is immediately accretive in the first year after closing. WFI will pay the
purchase price with a combination of cash on hand and cash provided under a new credit facility to be provided by KeyBanc. (NOTE: The new
credit facility is in the amount of $85 million.) The transaction is subject to customary closing conditions, including expiration of waiting periods
under applicable antitrust regulations, and is expected to close by the end of the third quarter.
45. Science Applications International Corporation (SAIC) announced that it has signed a definitive agreement to acquire bd Systems, Inc., a provider of
aerospace engineering and information technology (IT) services headquartered in Torrance, California. The acquisition, when completed, will complement SAIC's technical and operational presence within the space and IT market and will enable bd Systems to better serve the growing challenges
facing its client community. The bd Systems organization will become a subsidiary of SAIC, led by bd Systems' current Executive Vice President and
Chief Operating Officer Mike Smith. bd Systems employs more than 330 people supporting government and commercial clients in more than 20
locations throughout the U.S., including: Los Angeles, Calif.; Colorado Springs, Colo.; Huntsville, Ala.; San Antonio, Texas; Vandenberg AFB,
Calif.; and Washington D.C. Their core capabilities include systems engineering, enterprise network management, aerospace engineering, logistics
and sustainment support, geographical information systems, and acquisition support. SAIC is the largest employee-owned research and engineering
company in the United States, with more than 43,000 employees in over 150 cities worldwide. For the fiscal year ended January 31, 2006, the company reported annual revenues of $7.8 billion.
46. MTC Technologies, Inc (NASDAQ:MTCT), a significant provider of engineering, information technology, and other technical solutions to the Department of Defense (DoD) and national security agencies, announced that it has acquired a minority equity share of USfalcon, Inc., a certified 8(a),
Small Disadvantaged Business, and Service Disabled Veteran Owned company, headquartered in Morrisville, NC, with offices in MA, NJ, AL, and
AZ. The specific terms of the agreement were not disclosed. USfalcon executes its current business throughout the United States and in the Southwest Asia war zone. USfalcon's primary business focus is professional engineering services and intelligence operations, but the company also performs various tasks in information technology solutions, training services, and logistical operations. USfalcon is a prime holder of the recently
awarded Communications and Electronics Life Cycle Management Command (CE LCMC) Strategic Services Sourcing (S3) Contract, worth nearly
$20 billion over its ten-year contract period. The S3 contract provides engineering, logistics, and business analytical services to its Army clients.
47. EPAM Systems, Inc., a global software services company, and Vested Development, Inc., one of the Top 5 Russian Software Outsourcing vendors,
have announced a strategic merger. The combined company, which will operate under the EPAM Systems name, will employ over 2,200 software
professionals across eight countries and exceed a $70 million revenue run rate. By combining the operations of the companies, EPAM becomes
stronger in both client facing and delivery capabilities as well as in senior management capacity across North America, Europe, and the former Soviet
Union region. EPAM Systems is a global provider of software engineering outsourcing services. Founded in 1993, EPAM maintains North American headquarters in Lawrenceville, NJ, and European headquarters in Budapest, Hungary, as well as support and delivery operations in the UK and
Germany. EPAM software development centers are located in Russia, Belarus, Ukraine and Hungary. EPAM's customer base includes industry
leaders such as Reuters, London Stock Exchange, Colgate-Palmolive, British Telecom, Empire and CareFirst BlueCross BlueShield, Schlumberger
and Halliburton and technology leaders such as SAP, Hyperion, BEA Systems and Microsoft.
48. Oracle (NASDAQ: ORCL) announced that it has agreed to invest US$125 million (approximately Rs. 5,815 million) in i-flex solutions (Bombay
Stock Exchange: IFLX.BO and National Stock Exchange of India: IFLX.NS) to fund growth initiatives, including its pending acquisition of Mantas,
Inc. i-flex will issue approximately 4.45 million equity shares to Oracle under a preferential allotment. The price of the shares under the preferential allotment will be Rs. 1,307.50 per share, which is the floor price established by the Securities and Exchange Board of India (SEBI) formula for a
preferential allotment as of the reference date of August 13, 2006. Upon completion of the preferential allotment, Oracle's ownership in i-flex is
expected to increase from the current 52.5% to 55.1%. As required by Indian law, Oracle will make a mandatory open offer to purchase up to an
additional 20 percent of the shares outstanding from the remaining i-flex shareholders at a price of Rs 1,475.00 per share in accordance with SEBI
Regulations. The open offer price is based on the SEBI formula for the minimum price of the mandatory open offer.
49. Achievo Corporation, a global software and information technology outsourcing provider with a local front-end and China back-end service model,
announced a definitive agreement to merge with Beijing Beifang Xinyu Information Technology Co., Ltd. (BBX). With 450 employees, this merger
represents Achievo’s largest acquisition by headcount, and with over 90% of its revenues from outside China, it positions Achievo as one of the biggest independent overseas offshore software outsourcing businesses in China. BBX, founded in 1999, provides software development and IT services to Japanese companies with offshore outsourcing services in China. BBX is noted for its expertise in finance, telecommunications, manufacturing, government and other industries. The merger further strengthens Achievo’s presence in Japan through BBX’s established relationships with
customers that include NEC, Nomura, Toshiba and Hitachi. When the merger is completed, BBX will be a wholly owned division of Achievo Corporation. BBX is the third merger Achievo has completed in the last two years with software development companies whose business mainly originates from and in Japan. Last year Achievo acquired Advanced Network Services (ANS) Group, now Achievo ANS. This year Achievo acquired
Shanghai Wintech Software Co., Ltd., now Achievo Wintech. In March 2006, the employees of Global Friends Network, a Tokyo-based software
and IT firm that provided software development and quality assurance services to Japanese companies, joined Achievo. With expertise in diverse
technologies including Java/J2EE, .NET and embedded platforms, the CMM-certified company offers improved efficiencies, scale, diversification,
and a combined talent pool to deliver cost-effective, quality-centric, and scalable IT outsourcing services to customers and partners worldwide.
Headquartered in the Silicon Valley, Achievo has offices in the United States, Canada, Germany, China and Japan.
50. Electronic Data Systems Corp planned to raise its interest to 61.8% from 51.72% by acquiring a further 10.08% stake, or 16.241 million ordinary
shares, in MphasiS BFL Ltd (MB), a software developer, in a privately negotiated transaction. The transaction was to include the merger of Electronic Data Systems (India) Pvt Ltd, a wholly-owned unit of ED, with MB.10
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51. Safeguard Scientifics, Inc. (NYSE:SFE), which builds value in high-growth life sciences and information technology companies, announced that its
partner company, Alliance Consulting Group acquired Fusion Technologies, a provider of global delivery IT services. This strategic acquisition further enhances the value and long-term potential of Alliance Consulting, which is wholly-owned by Safeguard Scientifics. In April 2006, Alliance
divested its Southwest Region in order to better align its opportunities with the company's strategic direction. The proceeds from this divestiture
provided most of the funds for Alliance to acquire Fusion Technologies, with its U.S. headquarters (in Edison, New Jersey.) and extensive operations in Hyderabad and Bangalore, India. Fusion Technologies was at an approximately $15 million annual revenue run rate in the most recent quarter, and it has over 30 active clients primarily in the financial services and high technology industries. The acquisition accelerates Alliance's strategy
of delivering high-value, Information Management and Application Outsourcing services via a hybrid global delivery model. Approximately 80% of
Fusion's 250 employees are based in India, more than doubling the size of Alliance Consulting's Indian operations. The acquisition will support the
company's plan to grow that portion of the business to over 1,000 employees. Both firms have been experiencing over 50% growth in their Indian
operations in 2006. The addition of Fusion brings Alliance industry-leading expertise and partnerships in the growing areas of .NET development
and Open Source Software. Fusion has been a leading .NET custom application developer for an impressive roster of Software Providers and Fortune 2000 companies. The company is a leader in complex, open source implementations with over 50 leading component technologies deployed at
Fortune 2000 organizations. These acquired capabilities will enable Alliance to continue to assist its clients in managing the application lifecycle with
increased quality and decreased costs. Fusion serves over 30 active clients primarily within the Financial Services and High Technology industries.
Safeguard acquired Alliance Consulting in 2002, and has helped to refocus the company's go-to-market strategy, added senior management talent
and helped to significantly improve the company's financial results.
52. HiSoft Technology International, a leading IT services provider with offices in China, Japan, and the U.S., announced today the completion of Series-B International Financing. This is the largest investment in China's IT outsourcing service industry to date. The investment is led by Granite
Global Ventures (GGV) with new investment from Draper Fisher Jurvetson ePlanet Ventures, Mitsubishi UFJ Securities (HK) Capital Limited and
Sumitomo Corporation Equity Asia Limited. Series-B investment will be used to further strengthen HiSoft's management and delivery teams as well
as to pursue organic and inorganic growth. The new round of financing follows the Series-A investments in HiSoft in 2004, when investments were
made by Granite Global Ventures (GGV), Intel Capital, Granite Global Ventures, International Finance Corporation (IFC) and JAFCO Asia. The
Company also announced the appointment of Mr. Loh Tiak Koon as the company's new Chief Executive Officer and a member of the Company's
Board of Directors. Loh will succeed Mr. Li Yuan-Ming, a key founder, Chairman and Chief Executive Officer of HiSoft since 1996. Li, who will
remain Chairman of the Board, recruited Loh to join the Company.
53. SecureWorks and LURHQ have merged to form the new SecureWorks, a leading, pure-play Managed Security Services Provider (MSSP).
SecureWorks is now managing 1,500 clients and 5,000 security devices worldwide. Terms of the deal were not disclosed. Mike Cote, president
and CEO of SecureWorks, will serve as President and CEO of the combined companies, while LURHQ founder and CEO Tony Prince will be Executive Vice President. Prince will be responsible for guiding strategy for the combined company. The remaining leadership positions in the company will be filled with a blend of LURHQ and SecureWorks executives. The company will be headquartered in Atlanta, Georgia with offices in
Chicago, Illinois and Myrtle Beach, South Carolina and Charlotte, North Carolina. The merged company will maintain 24x7x365 Security Operations Centers in Atlanta, Chicago and Myrtle Beach.
54. AT&T Inc. (NYSE:T) announced today that its subsidiary, AT&T Corp., has agreed to acquire privately held USinternetworking, Inc. ("USi"), an
independent Applications Service Provider (ASP) for approximately $300 million in cash and assumed debt. The transaction, which is expected to
close in the fourth quarter, is designed to enhance AT&T's enterprise service offerings. The transaction aligns USi's software and eBusiness management services and consulting expertise with AT&T's existing portfolio of enterprise hosting and managed services. IT market research and advisory
firm IDC estimates that application management services represented a $21.5 billion market worldwide and a $9 billion market in the U.S. in 2005,
and expects both markets to continue to experience growth. (Source: IDC, Worldwide and U.S. Application Management Services 2006-2010
Forecast, April 2006). Following the acquisition, the company will operate as a wholly owned subsidiary and business unit within AT&T's existing
enterprise services organization, which is led by Group President Forrest Miller. AT&T expects to retain USi's team and its domestic and international operations. Andrew A. Stern, USi's chairman and chief executive officer will join AT&T as CEO of USi upon the closing of the transaction.
55. Verano, Inc., the SCADA security company, announced the acquisition of the Managed Security Services Division of e-DMZ Security LLC. As a
result of this acquisition, Verano is launching Industrial Defender Co-Managed Security, a co-managed security service for the real-time SCADA and
control environment. Industrial Defender Co-Managed Security is the latest component of Verano's full security life-cycle solution for real-time
SCADA and control environment, which also includes SCADA security professional services, through Plant Data Technologies, Inc., and technology
deployment with Verano's Industrial Defender. Headquartered in Wilmington, Delaware, e-DMZ Security Managed Services is the services division
of e-DMZ Security LLC, providing co-managed firewall and intrusion detection services for high-risk financial services, pharmaceutical and industrial networks. Currently supporting Fortune 100 customers with managed devices in over 18 countries, e-DMZ Security Managed Services provides 'Razor Wire Protection(TM) between the internet and their customer's internal network through a 24x7x365 manned security operations
center. A privately held company founded in 1996, Verano is headquartered in Mansfield, Massachusetts, with major operations in Calgary, Canada,
Houston, Texas, and Wilmington, Delaware.
56. DST Systems, Inc. (NYSE: DST) has signed a definitive agreement to acquire Amisys Synertech, Inc. (Amisys) through a merger with a wholly
owned subsidiary of DST Health Solutions, Inc. Financial terms of the transaction were not disclosed. Amisys is an enterprise software developer,
software applications service provider, and business process outsourcer for the U.S. commercial healthcare industry. Amisys reported revenues of
$103.4 million for the year ended December 31, 2005 and $65.1 million for the seven months ended July 31, 2006. Amisys has approximately
1,400 employees located in three principal locations: Harrisburg, Pennsylvania; Rockville, Maryland; and Hyderabad, India.
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57. Cognizant Technology Solutions (NASDAQ: CTSH) announced it has acquired Massachusetts-based AimNet Solutions Inc., a managed infrastructure and professional services firm. In acquiring AimNet, Cognizant gains capabilities and expertise that strengthen the Company's fast-growing IT
Infrastructure Services (ITIS) practice. Founded in 2000 by former AT&T executives, AimNet is a privately-held company with over 100 employees. This transaction provides Cognizant with a state-of-the-art US-based Network Operations Center (NOC), a world-class patent-pending, proprietary infrastructure management software platform, an installed base of over 80 direct and indirect customers and partners, and high-end network
and infrastructure consulting capabilities in areas such as network architecture, planning, design and infrastructure security solutions. In addition,
Cognizant gains a highly experienced management team, led by industry veteran Ed Nalbandian, CEO of AimNet, who will join Cognizant to manage its IT Infrastructure Services practice. AimNet offers a full range of IT infrastructure management services from consulting to 24x7x365 managed services. AimNet's expertise spans a wide spectrum of clients' IT infrastructure, including Wide Area Network (WAN), Local Area Network
(LAN), Virtual Private Network (VPN), Security, IP Telephony, Server and Application support. These services are powered by AimNet's enterprise-class, ITIL-based "OnTarget" Network Management Platform deployed at its Massachusetts-based Network Operations Center (NOC). The
deal was valued at approximately $15 million in cash. AimNet had raised nearly $60 million in VC funding since its 2001 inception, from firms like
Mellon Ventures and North Atlantic Capital.
58. mindSHIFT Technologies, a Managed Services Provider (MSP), announced that it closed an additional $18 million in funding, with previous investors Columbia Capital of Alexandria, VA and Fidelity Ventures of Boston, MA participating in the round with a new investor, TD Fund of Washington D.C. With operations in Boston, New York, Philadelphia and Washington D.C., mindSHIFT offers both managed services and professional
services to small- and medium-sized businesses. The company’s portfolio of managed services provides a solution which includes services such as
email management and administration, electronic backup for servers and desktops, virus and spam protection, desktop support, and server management. All customers are supported by both a 24-hour Network Operations Center for proactive management support and a call center which diagnoses and resolves all end-user desktop issues. For advanced and larger businesses, the company provides business application migrations, storage
area network upgrades and complex hosting applications.
59. Globix Corporation (AMEX:GEX), a provider of Internet infrastructure and managed services, announced a definitive agreement to sell its whollyowned subsidiary, Globix Holdings (UK) Limited (``Globix UK'') to TelecityRedbus, Europe's leading independent provider of colocation and data
center services. The transaction is expected to close in three weeks and is subject to customary terms and closing conditions. TelecityRedbus will
pay US$62 million (assuming negative working capital $675 thousand) for Globix UK and its associated pan-European network, which extends to
the core business hubs of Paris, Amsterdam and Frankfurt. In addition, it will acquire two high-specification data centers, totaling 40,000 square feet
in central London, industry-leading Internet network infrastructure, a comprehensive portfolio of managed services and Globix' highly experienced
team of technical and management specialists. The Purchase Agreement anticipates that Globix and certain of its subsidiaries will provide the purchaser with transition services for a period of up to nine months following the closing of the transaction. The Purchase Agreement also provides for
the purchaser to retain 5% of the purchase price as security for breaches of certain representations and warranties that arise before March 31, 2008.
On completion of the acquisition, TelecityRedbus will have over 300 employees supporting 19 fully fitted data centers, totaling 550,000 square feet,
across seven European countries, making it one of Europe's largest and most advanced data center infrastructure and managed service providers.
TelecityRedbus will add Globix' 400 customers including Lloyds TSB, The Telegraph, Carphone Warehouse, 888.com and Ebookers, to its client
base, which already includes major UK brands including the BBC, Guardian Unlimited, Sony Computer Entertainment and FriendsReunited, creating a combined UK customer base of over 2,000. TelecityRedbus projects a combined turnover of at least GBP76 million for 2006.
60. Relational Technology Solutions Company (RTS), a North American technology and financial solutions company, announced that it has acquired the
Professional Services Group of AGT International, Inc. The acquisition enables RTS to offer application consulting and development services to its
growing base of customers seeking to deploy technology to solve business challenges and improve efficiencies. AGT’s Professional Services Group
has joined RTS team based in Columbus, Ohio. Terms of the sale were not disclosed. Prior to the acquisition of the professional services unit, AGT
International was a long-term partner of RTS. AGT has a well-established reputation as one of the original Lucent Technologies ‘Independent Software Vendors’ (ISV); is a solutions provider for the Avaya platform; and carries the distinction of serving as an Avaya DeveloperConnection program
member. Following the acquisition, RTS will also become a DeveloperConnection program member of Avaya which will enable RTS to gain additional application development support services it can use to benefit RTS customers.
61. Coastal Technologies Inc (Pink Sheets:CTTJ) a full service Information Technology (IT) consulting firm and custom software developer, signed a
Letter of Intent to merge with Cleveland-based BTi Business Continuity Inc, a provider of data recovery, business continuity, and remote backup
services. BTi has a data center in Youngstown, Ohio and currently has centers under construction in Leetonia, Ohio and Virginia. The companies
had previously announced a strategic partnership in May of 2006.
62. SeaWaves Technology announced the acquisition of the webhosting company Colorteck Network. Colorteck, a full service webhosting company
with dedicated servers at a major datacenter, has over 300 active customers, and a variety of standard and reseller hosting plans. The acquisition
allows SeaWaves to offer more expansive webhosting possibilities to existing clients, and provides them with a sizable base of customers to which
they can offer existing web promotion services.
63. Microland Limited, an Indian provider of IT Infrastructure Management and Technical Support Services, announced that it has secured US$11 Million in funding from Cargill Ventures, Intel Capital, Trident Capital and JAFCO Investment (Asia Pacific) Ltd. The funds raised will enable Microland to invest in new infrastructure and accelerate its business growth in the Remote Infrastructure Outsourcing market. Microland currently has a
client base of over fifty global customers ranging from a Media Company, Global Services Company, Banking & Financial Services Institutions, multiple High Tech IT companies, major Software Corporation to a diversified Business Conglomerate. With an expanded workforce of 1600+ profes-
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sionals, all encompassing services that relate to monitoring, managing and enhancing the performance of a client’s IT Infrastructure and being ISO
20000-1 & 27001 and BS15000 & BS 7799 Certified, Microland is well positioned to lead Remote Infrastructure Management services, the third
wave of IT outsourcing to India.
64. Advanticom, Inc., a provider of voice data solutions for 1,500 customers in the Western PA and Tri State region, acquired the servicing rights with
respect to customers of NetTec Services, a regional data solutions company and Internet Services Provider, effective August 1, 2006. Brian Conboy,
founder and president of Advanticom since 1997, will continue to head the expanded Advanticom as president. Daniel M. Pultz, president of NetTec Services and all of its predecessor companies since 1973, will now be directing business development for Advanticom. Advanticom now will
offer new services in addition to Advanticom's voice communications solutions, including data networking experience, NetTec's IP Telephony voice
experience, Cisco advanced technology products, along with NetTec's ISP and remote "Alert+" and in-house "Vista & Dash" monitoring and management capabilities. Advanticom employs 40 technicians and sales team members.
65. Peak 10, Inc., an independent data center operator and managed services company, announced the acquisition of RenTech, a Nashville-based data
center operator and outsourcing firm for information technology services. The acquisition enhances Peak 10’s position as an industry leader with a
large and growing customer-base, geographic diversity, and a comprehensive portfolio of products and managed services. Peak 10 will now own
and operate eight data centers in six key market locations. The terms of the acquisition were not disclosed. RenTech is a data center operator and
IT outsourcing firm that provides managed colocation, enterprise and web hosting, redundant connectivity, and a wide range of managed services
from its enterprise-class data center in the Nashville metropolitan area. The company has a well-earned reputation for partnering with its clients to
provide cost-efficient technology solutions that achieve success through innovation, communication and successful collaboration. RenTech’s customers include notable firms such as Rivals.com, Bondware, IASIS Healthcare, Country Wired and Resource Communications Group.
66. Computer Services, Inc. (Pink Sheets: CSVI) announced that it acquired a majority ownership in Heartland Communications Internet Services, Inc.,
a provider of Internet and telephone services. CSI increased its equity stake in Heartland by 14% to bring its ownership level to 63% from the 49%
acquired in April 2005. President and Chief Executive Officer Steven Powless commented on the investment, “During the second quarter, we increased our investment in Heartland Communications another $1.3 million to provide additional working capital while it completes the network
build-out that will support CSI customers and allow Heartland to sell wholesale communications and bandwidth. Although we expect to incur operating losses from Heartland in the foreseeable future as they complete the build-out phase and begin to market the new capacity, we believe Heartland’s expertise in Internet and telephone services can be leveraged to improve CSI’s costs for these key services over the long run.” Computer
Services, Inc. (CSI), provides service and software solutions for community banks in both a service bureau and an in-house environment.
67. Pharos Capital Group, LLC of Dallas and Nashville, announced that it has invested $7 million in VeriCenter, Inc., a leading IT infrastructure and
managed services company. Based in Houston, VeriCenter provides a comprehensive range of enterprise managed hosting services through its nationwide footprint of data center facilities. The Company intends to use the proceeds to expand its production data center footprint within four of
its existing data center facilities around the U.S. In conjunction with the financing, Jim Phillips, Partner at Pharos Capital, has joined the Company’s
Board of Directors. Based in Dallas and Nashville, Pharos Capital Group currently has approximately $500 million in capital under management.
Pharos primarily invests $10 to $20 million in companies seeking later stage equity funding for internal growth, acquisitions, management buyouts
or recapitalizations across industry sectors, with particular focus on healthcare, business services and technology.
68. US Technology Resources Inc (USTRI), a provider of IT Services & Business Process Outsourcing Solutions to Fortune 500 clients, announced its
acquisition of QA Labs Inc (QAL), the largest independent software testing and quality assurance provider in Canada. Terms of the deal were not
disclosed. Founded in 1999, and based out of Vancouver, Canada - QA Labs serves clients in Telecom & Wireless, Life Sciences & Healthcare, Insurance & Financial Services, Media & Games and Packaged Software. The firm designed its services to assist clients to build its own testing infrastructure, create test strategies, design test cases, custom test automation and development, and test execution. In May 2006, QA Labs was recognized among the Global Outsourcing 100 by the International Association of Outsourcing Professionals. QA Labs will expand US Technology's
"World Class" Quality Assurance and Test services to Fortune 500 clients. Through this acquisition, USTRI also expands it global footprint and
ability to offer its comprehensive range of IT services through an Integrated Global Delivery Model which includes Onsite, Onshore, Nearshore &
Offshore locations to its marquee clients. USTRI's Global Development Centers include (but not restricted to) multiple cities in US, Canada, India
& Malaysia. US Technology Resources Inc. (USTRI) is part of The Comcraft Group, a USD $5.5 Billion global conglomerate with presence in over
45 countries.
69. Synergetic Technologies Inc. (Pink Sheets: SYGG), a provider of Digital Video Streaming Technology, announced that it has entered into a purchase
agreement to acquire 100% of two High Speed internet providers (Net 3 Inc. and Quick Internet). The two companies will bring assets, revenue,
subscribers and opportunity to grow by overlaying Synergetics Video streaming systems and technology which can provide Video content and Video
Security to its broadband subscribers. The companies, with 2,000 plus subscribers combined, bring with them the ability to expand through its long
term agreements with Qwest and others and its expansive wireless network. The acquisition also adds services to the unique revenue model the
company has developed with its ad insertion system deployment into cable TV networks and Hotels. The traditional ad sales model, a "per inquiry"
and an online mall model, that generate a consistent inflow of revenue once purchased. Synergetics will now have services of its own that can be sold
nation wide.
70. Synergetic Technologies Inc. (Pink Sheets: SYGG), a provider of Digital Video Streaming Technology, announced that it has entered into a purchase
agreement to acquire 100% of two High Speed internet providers (Net 3 Inc. and Quick Internet). The two companies will bring assets, revenue,
subscribers and opportunity to grow by overlaying Synergetics Video streaming systems and technology which can provide Video content and Video
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Security to its broadband subscribers. The companies, with 2,000 plus subscribers combined, bring with them the ability to expand through its long
term agreements with Qwest and others and its expansive wireless network. The acquisition also adds services to the unique revenue model the
company has developed with its ad insertion system deployment into cable TV networks and Hotels. The traditional ad sales model, a "per inquiry"
and an online mall model, that generate a consistent inflow of revenue once purchased. Synergetics will now have services of its own that can be sold
nation wide.
71. ISG TECHNOLOGY INC. announced that it has acquired Blue Fusion Corporation based out of Earth City, MO, a suburb of St. Louis. Blue Fusion
is a technology firm that specializes in local and wide area networking, Cisco IP Communications, and Microsoft solutions. They will become ISG
Technology’s ninth location. This acquisition will expand ISGs coverage in the St. Louis and surrounding area. The new branch will offer ISG’s full
solution portfolio which includes offerings for data, voice, video and security solutions in the business market. The St. Louis team holds several technical certifications with Cisco and Microsoft and offers a strong background in IP Telephony design and implementation. The focus of the St. Louis
branch will be consistent with ISG’s overall strategic direction which focuses on the SMB market. ISG has 24 years of experience serving businesses
throughout the Midwest and 115 employees company-wide.
72. IBM (NYSE: IBM) and Internet Security Systems, Inc. (NASDAQ: ISSX) today announced the two companies have entered into a definitive agreement for IBM to acquire Internet Security Systems, Inc., a publicly held company based in Atlanta, Ga., in an all-cash transaction at a price of approximately $1.3 billion, or $28 per share. ISS generated $163.5 million in revenue and $17.5 million in EBIT for the 6-month period ending June
30, 2006. For the fiscal year ending December 31, 2005, the company generated $329.8 million in revenue and $56.7 million of EBIT. The acquisition is subject to Internet Security Systems, Inc. shareholder and regulatory approvals and other customary closing conditions. The transaction is
expected to close in the fourth quarter of 2006. Internet Security Systems (ISS), founded in 1994, provides security solutions to thousands of the
world's leading companies and governments, helping to proactively protect against internet threats across networks, desktops and servers. ISS software, appliances and services monitor and manage network vulnerabilities and exploits and rapidly respond in advance of potential threats. This
acquisition advances IBM's strategy to utilize IT services, software and consulting expertise to automate labor-based processes into standardized,
software-based services that help clients optimize and transform their businesses. IBM will utilize ISS' X-Force security intelligence service, which
proactively protects networks with detailed analyses of global online vulnerabilities and threat conditions. The ISS global network of security operations centers (SOCs), which include sites in Tokyo, Brussels, Brisbane, Detroit and Atlanta, will also be added to IBM's existing global network of
SOCs. IBM security consultants and global sales force will also offer ISS' line of security appliances and software, and fully enable it for IBM and third
party products, services and solutions. ISS has more than 11,000 customers worldwide including 17 of the world's largest banks, 15 of the largest
governments, 11 of the top public insurance companies and 13 of the world's top IT organizations. ISS also brings to IBM a network of business partners skilled in selling the ISS product line and an expanded product set to the IBM Business Partner channel.
73. Comtech Telecommunications Corp. (NASDAQ:CMTL) announced that its Maryland-based subsidiary, Comtech Mobile Datacom Corporation, has
entered into a definitive agreement to acquire certain assets and assume certain liabilities of Insite Consulting, Inc. ("Insite"), a logistics application
software company. Consummation of the transaction is subject to the satisfaction of customary closing conditions. Insite, formed in 1998, has developed the geoOps(TM) Enterprise Location Monitoring System, a software-based solution that allows customers to integrate legacy data systems with
near-real time logistics and operational data systems. Such real-time operational data updates are distributed to command centers, mobile and fixed,
enabling them to share the same view of unfolding operations or emergency scenarios. Insite's primary customer is the United States Air Force.
Insite was recently awarded a contract to incorporate its software platform into a multi-national satellite-based friendly force tracking system to be
deployed by NATO. Comtech will purchase the business of Insite for $2.7 million, plus certain earn-out payments based on the achievement of
future sales targets. The first part of the earn-out cannot exceed $1.4 million and is limited to a five-year period. The second part of the earn-out,
which is for a ten-year period, is unlimited and based on a per unit future sales target primarily relating to new commercial satellite-based mobile
data communications markets. Insite's sales were less than $2.0 million in calendar 2005 and the impact of this acquisition on the Company's fiscal
2007 operating results is expected to be near break-even.
74. Modis(R) International, the United Kingdom-based information technology (IT) services business unit of MPS Group, Inc. (NYSE:MPS), announced
that it has acquired Netlogic, a leading provider of computer service and maintenance specialists in England. Terms of the transaction were not disclosed. Netlogic was launched in 1995 as a technical services company focused on server and network maintenance. The company soon began to
offer additional technical solutions to help manage network growth. Today, Netlogic is a full- service provider of IT infrastructure and network solutions. Modis International has been providing IT contract consultants for over 30 years, and today does business with FTSE 1000 companies and
government entities in the United Kingdom and continental Europe. With 14 offices in the United Kingdom, Belgium, Germany, and the Netherlands, it is one of Europe's largest providers of IT staffing services and solutions.
75. SEGULA Technologies, a European engineering, consulting, and IT services provider, announced that it has acquired KENDA Systems Inc., a national provider of IT services throughout the US. KENDA has offices in fifteen metropolitan markets in the US and providing information technology consulting and software development services, primarily to the Technology, Finance and Banking, Government, and Healthcare industries. With
a total staff of 400, KENDA's services include data management, development, infrastructure network, project implementation, logistics, training,
documentation, and general support services. "The KENDA business will be our platform to grow in the US Market, not only in the IT industry,
but also to develop other activities such as engineering solutions in the Automotive, Trucks, and Aeronautics area. SEGULA are planning for fast
growth in the US market and particularly in New York, Detroit, and Seattle, and is already in discussions with other US companies," said Albert
Nacinovic, President for SEGULA International Operations.

Volume 4 - AltAssets

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