Big high-technology government contractors have been gobbling up smaller companies as defense spending has boomed after the Sept. 11, 2001, terrorist attacks, but last week it was smaller companies doing a lot of the dealing, a trend experts say will probably continue.
"The way you achieve growth in this marketplace is through acquisitions," said Ray Bjorklund, chief knowledge officer at Federal Sources, a McLean research and consulting firm. "They may choose to get into a new line of business or get out of a line of business. By acquiring companies they can execute that strategic plan far more quickly."
CompuDyne of Annapolis, the high-tech security company that sells products including prison locks and computer software, said it bought 90 Degrees for an undisclosed sum. The Yakima, Wash., company makes information management systems for the police and military.
Anteon International in Fairfax, which operates intelligence systems for the government, bought privately held Integrated Management Services for $29 million in cash to bolster its information security offerings.
Allied Defense Group, a Vienna maker of electronic security systems and ammunition, announced the acquisition of Control Monitor Systems, a California company that offers security to microchip companies, by Allied's Belgium-based security firm, VSK Group. The deal, terms of which were not disclosed, gives VSK entree to the U.S. market.
And SteelCloud of Dulles, which helps companies and government secure their computer networks, bought V-One of Germantown, which lets users log on remotely but securely to computer networks. The deal follows a February acquisition of Asgard Holding.
In this competitive market, these smaller firms are always looking for an edge.
"This acquisition is a continuation of our 2003 strategic plan to transform SteelCloud into a network security product company with our own software and appliances," SteelCloud chief executive Thomas P. Dunne said. "Now V-One products will become visible and viable in markets that are just starting to take off."
* Chesapeake Fields Farmers is bringing out in September a high-quality bread that's also low-carb, low-cal, high-protein and has no genetic modifications. The hope is that the Chestertown farmers' cooperative will rejuvenate farming on Maryland's Eastern Shore. In 15 years, 90,000 acres of farmland have disappeared from the Delmarva Peninsula. Chesapeake Fields projects it will create 143 jobs and $52 million in revenue within four years and plans multiple bakeries near Chestertown. The first Chesapeake Fields bread will initially be sold at 700 retail outlets in the Delmarva region.
* Marriott International of Bethesda ventured into the resort market in China, opening its first resort hotel there, the 465-room Sanya Marriott Resort. The hotel operates under a management agreement with Sanya Jahwa Resort Development Co., a subsidiary of Jahwa Group that is in manufacturing and trading cosmetics, pharmaceuticals, chemicals, mineral water, and real estate development. Sanya is on the southern tip of Hainan Island, at approximately the same latitude as Hawaii. Marriott manages 24 hotels in China and Hong Kong.
* Comstock Homebuilding of Reston asked the Securities and Exchange Commission for permission to sell stock to the public for the first time. Comstock builds and sells single-family homes, townhouses and condominiums and also develops land for its home-building operations. Comstock operates in the Washington area and in Raleigh, N.C. The underwriting is being led by BB&T Capital Markets. All the shares in the initial public offering are being sold by the company; no current shareholders plan to sell in the offering.
* Atlantic Realty of Vienna, one of the 10 largest developers in the Washington region, got city council approval for a major mixed-use project in Falls Church. The 500 Maple project is made up of two buildings on 4.7 acres with 75,000 square feet of office, 22,000 square feet of ground floor retail, 230 residential condominiums, 3,000 square feet of arts flex space and all-underground parking. The office building will be the largest office structure built in Falls Church since George Mason Square (also owned by Atlantic Realty) in the 1980s. Construction of 500 Maple, which is being designed by Lessard Architectural Group, will begin next year.