The company is small and its stock offering even smaller, but Anadac Inc. of Arlington is a firm with big ambitions.
Anadac is one of the many professional services firms located in that consultant's heaven known as Crystal City. With 65 full-time employes and several millions of dollars worth of U.S. Navy contracts, the firm is deep into a number of major military projects. Anadac's largest contract, for example, involves logistic and support services for the Trident submarine program.
Anadac stands for "Analysis, Advice and Action," which has a sort of military ring to it. That seems proper under the the circumstances. Anadac's founder and chairman, John J. Bennett, retired from the U.S. Air Force as a colonel with 28 years of service and is an expert in the financial management of large weapons systems. He also held several key roles in the government, including:
*Principal Deputy and Acting Assistant Secretary of Defense for Manpower, Reserve Affairs and Logistics, from 1975 to 1976.
*Assistant Secretary of the Navy for Installation and Logistics, from 1976 to 1977.
*Director of the Federal Acquisition Institute in the Executive Office of the President, from 1977 to 1980. The institute's mission was to upgrade the performance of federal procurement workers.
Anadac is offering 100,000 shares to the public at $5.50 each. Of these shares, 80,000 are being offered by the company and 20,000 by Bennett, who has owned 69 percent of the stock. After the offering, he will own 54 percent of the company. The sale of stock will raise $274,000 for the company and $110,000 for Bennett.
The underwriting is being handled by Wachtel & Co., a small Washington brokerage firm that specializes in venture capital deals, both private and public. Bonnie K. Wachtel, investment banker and attorney, is on the board of directors of Anadac.
As usual, new public investors will pay more for the stock than company officials paid. The company shareholders will own about 80 percent of the stock at a cost of $64,500, or 16 cents a share. New shareholders will own about 20 percent of the stock at a cost of $550,000, or $5.50 a share.
Anadac's financial data offers a snapshot of a company with a growing business. Biographical data indicates that the firm, anticipating expansion and change, recently brought in a number of new executives.
Anadac chalked up contract revenue of $2 million in 1982 and about $3.6 million in both 1983 and 1984. For the first 10 months of 1985, the firm moved up to $5.3 million. Profits in 1982 were $169,400 (32 cents a share), dropped off to about $156,000 in both 1983 and 1984 (31 cents and 32 cents), and grew to $199,000 (43 cents) in the first 10 months of 1985.
In a business where backlog is a measure of what's ahead for a company, the firm notes that its backlog -- revenue waiting to be earned -- amounted to almost $5 million in October, compared with $3.5 million at the same time in 1984.
On the management side, five vice presidents have joined up since last June, two of them as recently as last month. They include Theodore J. Marcucilli, who worked for the U.S. Navy from 1966 to 1980 in several top management jobs.
The new vice presidents were brought in, Bennett said, by his heir apparent, Harrison N. Walther, the company's president. Bennett, who is 62, said he is planning to retire in three years. Going public will mean several things, he said. "It will establish a stock price for my shares, and there'll be some ego satisfaction in being able to say I set up a company, met the bottom line and took it public. That was a goal I had."
Bennett said he also wanted to give the employes an opportunity to participate. They will be able to do that through a stock-ownership plan and, eventually, he said, the company may be owned by the employes.
One of the most serious challenges faced by Anadac is the change in the defense contracting game from "sole source," or noncompetitive, contracts to a stricter system of competitive bidding. Inevitably, it has produced a much more competitive climate for companies like Anadac.
Anadac, which derives 90 percent of its business from the Navy, said it has taken steps to become more price competitive, less dependent on Navy business and more active in winning business from the private sector. Even so, Anadac will continue to focus most of its efforts on Washington's multibillion-dollar market for professional services.
A two-sided plan to protect itself from corporate raiders and enhance its own ability to pursue mergers is being offered to stockholders by Insituform East Inc. of Landover, Md. The firm, which rehabilitates sewer, gas and water pipes without excavation, made the 1985 "winners" list with a gain of 259.6 percent in its stock price.
The company proposes to boost its common shares from about 4 million to 14 million, and then to create 4.5 million shares of "B class" common stock. Holders of common stock could convert to the B shares if they wished. B shares would have 10 votes a share, common shares would have one vote a share.
If a stockholder decides to stay with the common shares rather than convert, he will receive a 10 percent stock dividend in common shares and a 20 percent bonus on cash dividends paid for 12 consecutive quarters -- when the firm begins to pay dividends. The proposal is subject to stockholder approval at the annual meeting on Feb. 17.
Arthur G. Lang III, president, expects most stockholders to stay with common shares. If so, the effect will be to lodge voting control of the company in the hands of the board of directors, who now have about 40 percent of the voting power. The new plan would raise that to more than 50 percent.
Currently, the biggest bloc of votes, 31.2 percent, is held by Cerberonics Inc. of Baileys Crossroads, a professional services firm that works primarily for the Defense Department. Cerberonics is represented on the Insituform board.
With voting control of Insituform firmly in the hands of its board members, Insituform not only would be protected from raiders, but also could move quickly on any acquisitions it decides to make, Lang said.
After many years of taking other companies public, Alex. Brown & Sons of Baltimore, one of the nation's oldest investment banking firms, has decided to take itself public. The brokerage house, founded in 1800, is offering 1.9 million shares of common stock at a price of $20 to $23 a share. That would raise between $39.4 million and $45.3 million, which will be used to pay off debt. The prospectus reveals that the firm had up years in 1981, 1982 and 1983, but fell off in 1984, and came back in 1985 to $171 million. Last fall, when the bull market was flourishing, revenue was running at a $200 million-a-year pace. The document also reveals that five top officials each earn more than $400,000-a-year.
The National Association of Securities Dealers, the organization that operates the over-the-counter market called "Nasdaq," makes its home at 1735 K St. NW, in downtown Washington. Last week, the NASD opened a public reference room on the second floor of its building that will provide access to public documents of Nasdaq companies. The documents include annual reports, quarterly reports, proxy statements, and tender offers or acquisition filings. In addition, an electronic index to the documents will be available. The reports can be read on microfiche, or copies of the documents are available at 15 cents a page.
The Nasdaq reference room will be run by Disclosure Information Group of Bethesda. For 17 years, Disclosure ran the reference room operation at the Securities and Exchange Commission. Last year, however, the SEC awarded the contract, instead, to the giant Bechtel Corp., whose information services division is in Gaithersburg, Md.
Furniture retailer Heilig-Meyers of Richmond, which operates 139 stores in eight southeastern states, will split its stock 3-for-2 effective March 8. . . . Dynalectron Corp. of McLean, an international engineering company, has moved from the American to the New York Stock Exchange.