BDM International Inc. of McLean for the first time is selling common stock to the public to pay $8 million in bank loans and to prepare for future acquisitions.
The diversified professional-service firm, started in 1959 as Braddock, Dunn and McDonald Inc., filed a registration statement with the Securities and Exchange Commission on Aug. 29, detailing the offering of 475,000 shares of common stock.
Each share will be sold between $13 and $16.
Proceeds of the sale of $400,000 shares of the company's stock will be used to pay $8.3 million in loans from Manufacturers Hanover Trust Co., to invest in short-term securities and to be available as working capital, according to the company's prospectus.
Although BDM doesn't have immediate acquisition plans, it may keep some of the proceeds on hand to acquire professional-services firms, particularly those in nongovernmental markets, the prospectus said. Nearly all BDM revenues have been derived from federal contracts.
BDM won't receive proceeds from sale of the remaining 75,000 shares because they are held by the three company founders.
BDM -- which primarily engages in national defense and security, defense communications, energy, transporation and environmental projects for the government -- is in the midst of a dispute with federal officials concerning its largest contract, representing 13.7 percent of its revenues last year. That contract with the U.S. Army, which BDM has held for nine years, has been set aside by the Small Business Administration to be awarded to an economically and socially disadvantaged small firm.
BDM contended that the minority company is incapable of handling large technical national security contracts. The minority firms's officials have refused to comment, and the SBA hasn't yet decided the case.