Acquiring and absorbing a new company often leads to a surge of innovation, allowing successful businesses to not only benefit from the expansion of clientele and services, but also their capacity for new development. In the government IT sector, this means engineers, cybersecurity analysts, and other field experts can further come together to create solutions in critical areas of IT development and modernization.
This year has started out with a bang for private-equity firm, Veritas Capital, with its recent $7.1 billion acquisition. Perspecta, a federal IT contractor and the love child of a 2017 merger combining DXC Technology’s U.S. Public Sector Business with Vencore, Inc. and KeyPoint Government Solutions, has agreed to be absorbed by Veritas, in a cash deal set to take place sometime within the first half of 2021.
This deal is especially interesting considering that Veritas began the process of purchasing Northrop Grumman’s IT business for $3.4 billion in December of last year. The company now plans to combine the two newly-obtained corporations with its existing national security operation, Peraton, and will operate under that name.
Combining Perspecta and Northrop IT with Peraton will result in a company 7 times its original size, with a yearly revenue nearing $8 billion. The prospect of success is promising, as the software and employee skills of all three companies will come together to create an optimized list of services to offer the government sectors it serves.
Stu Shea, the CEO of Peraton, will remain the company head in this new merger. “Perspecta brings highly skilled talent and differentiated technology expertise...which will... enhance our ability to drive innovation,” he said.
Ensuring such a large operation is successful does not come without its own set of challenges. Namely, there is the issue of integrating all of the employees across the three companies into one unified workforce. Without some creativity, there could layoffs in the future as a result of having to eliminate redundancies between employees with similar positions. Along with that, comes the challenge of creating an interface which allows newly-acquired employees to assimilate with Peraton’s existing system of operation.
Whatever the future may hold for Peraton, one thing is clear, the expanded improvement to national security IT services will only benefit the U.S. government as digital transformation and cybersecurity remain top priorities.
