KippsDeSanto & Co. Advises Connexta on its sale to Octo, a Portfolio Company of Arlington Capital Partners
KippsDeSanto & Co. is pleased to announce the sale of Connexta, LLC (“Connexta” or the “Company”) to Octo, a portfolio company of Arlington Capital Partners.
Headquartered in Phoenix, AZ, Connexta is a leading provider of open source software solutions for global Intelligence, Surveillance, and Reconnaissance (“ISR”) data interoperability needs across the Department of Defense (“DoD”), Intelligence Community (“IC”), and international coalition partners. Leveraging established past performance coupled with intimate domain knowledge and expertise in modular, open source technologies, Connexta solves complex challenges for multi-domain ISR missions requiring aggregation, analysis, and dissemination of intelligence from a diversified data ecosystem that is geographically dispersed and siloed. Connexta employs approximately 130 personnel consisting primarily of full-stack and cloud engineers proficient in agile methodologies, industry certifications, and requisite security clearances.
The combination of the two firms allows Octo to be the go-to expert in data interoperability and user interface arenas for geospatial search and discovery solutions and combat systems. Octo’s acquisition of Connexta serves to expand capabilities and expedite delivery and data integration of combat systems across the Armed Forces and enhance Humanitarian Assistance and Disaster Relief tools for key customers in the National System for Geospatial Intelligence. This transaction also provides Octo significant international reach through contracts supporting strategic coalition partners in Europe, Asia, and Australia.
Connexta will provide product offerings that augment Octo’s existing capabilities. This comprehensive portfolio of product offerings coupled with differentiated services will broaden the combined entity’s customer footprint to reach currently untapped agencies and international allies with adjacent mission requirements and technical challenges that would benefit from the value-add the combined company now delivers.
We believe this investment demonstrates several key trends in the government services environment:
- Continued demand for high-growth DoD and IC-oriented firms with sustainable profitability;
- High demand for targets having demonstrated proficiency in leveraging proprietary technologies and unique product offerings to offer highly differentiated technology-enabled solutions;
- Acquirers continue to attribute strong value to companies with entrenched and defensible positions with key, hard-to-penetrate customers on mission-critical programs; and
- Increasing M&A activity by private equity – via new platforms and add-ons to existing portfolio companies
About KippsDeSanto & Co.: KippsDeSanto & Co. is the largest independent investment banking firm exclusively focused on serving leading, growth-oriented Aerospace / Defense, Government Services and Technology companies. We are focused on delivering exceptional M&A and Financing transaction results to our clients via leveraging our scale, creativity, and industry experience. We help market leaders realize their full strategic value. Having advised on over 100 industry transactions, KippsDeSanto is recognized for our analytical rigor, market insight, and broad industry relationships. There is no substitute for experience. For more information, visit www.kippsdesanto.com.
Octo Acquires Connexta to Enhance Open Source Software Development Capabilities
July 23, 2019
RESTON, Va. – Octo, a premier provider of next-generation services for the Federal market, today announced its acquisition of Connexta, a Phoenix, Arizona-based global leader in open source software development and secure discovery solutions for government and commercial customers. With this acquisition, Octo significantly bolsters its existing client base in the Intelligence Community (IC) and the Department of Defense (DoD), particularly the Air Force and its innovative software labs. Connexta’s substantial capabilities will expand Octo’s open source and Agile software development, cloud engineering, data interoperability, geospatial intelligence (GEOINT), and C4ISR offerings. The combination of the two firms establishes Octo as go-to experts in the data interoperability, API, and user interface arenas for geospatial search and discovery solutions and combat systems. The expanded capabilities Octo will realize through this acquisition will expedite delivery and data integration of combat systems across the Armed Forces and enhance Humanitarian Assistance and Disaster Relief tools for key customers in the National System for Geospatial Intelligence (NSG). This transaction also significantly enhances Octo’s sensor integration capabilities, to include support for several of the nation’s “Five Eye” partners.
Connexta will operate as a wholly owned subsidiary of Octo. The integration will provide U.S. Federal Government customers expanded access to Connexta’s solution offerings including its Distributed Data Framework, a powerful geospatially-enabled search and integration platform, and Alliance, a system for enterprise ISR data sharing. These tools promote collaborative use of discovered data by analysts to produce enhanced ISR products. The integration of Octo and Connexta systems will unlock new levels of data sharing and analysis for agency leaders, and the combined technical talent will offer customers a deep and sophisticated team capable of taking on much larger and complex mission system modernization projects than Octo has previously supported.
“This acquisition is a huge win for both firms. There are enormous synergies in our talent, culture, and solutions that will enable us to drive immediate value across our collective customer base,” said Mehul Sanghani, Chief Executive Officer of Octo. “Connexta’s two solution offerings lie at the heart of the ISR integration and GEOINT search and retrieval capabilities that are in use across many of our DoD and IC customers, and that have been increasingly embraced by our allied partners. Perhaps equally important, we’re both Agile and modern technology firms at our core with remarkably similar cultures. We’re adding a team that shares the same commitment to customer success that we do, and we’re only going to enhance these qualities as we integrate. Connexta’s culture also dovetails perfectly with Octo’s, which will only help make integrating our two firms smoother and allow us to maintain our unique culture in the marketplace.”
“Combining Connexta’s capabilities and services with Octo’s deep market knowledge will drive exponential value and impact for our combined customers,” said Andy Goodson, Chief Executive Officer at Connexta. “Our product offerings augment their services capabilities. Their broader customer base opens up new avenues for agencies to leverage our products. Additionally, we committed to our Connexta employees that we would place culture as a top priority in this process, just as Octo did. We knew very early on in the process that we had found a perfect match in Octo. We look forward to joining forces to provide more innovative, Agile solutions for both Octo’s and Connexta’s customers.”
Through this acquisition, Octo adds roughly 130 personnel to its roster, primarily full-stack and cloud engineering resources. Octo now offers nearly 700 technologists to support and accelerate modernization efforts across its entire public sector customer base. Octo maintains a heavy presence in the DC Metropolitan area with offices in Reston and Alexandria, Virginia and Columbia, Maryland, and has presences in Richmond, Boston, Dayton, and St. Louis. The acquisition of Connexta adds offices in Boston, Denver, and Phoenix and makes Octo a firm with international reach through contracts supporting strategic coalition partners in Europe, Asia, and Australia.
KippsDeSanto & Co. served as the exclusive financial advisor to Connexta during this transaction.
A premier provider of technology solutions, Octo empowers federal agencies to modernize faster. Octo’s combination of technical innovation and pragmatic execution unleashes new capabilities, bolsters security, and transforms service delivery. Octo specializes in scalable Agile software development, user experience design, and cloud engineering solutions to improve, modernize, and optimize government IT systems. Known for challenging the status quo and continually exploring new ways to deliver value, Octo’s superior outcomes are the result of a collaborative, analytical approach and customer partnerships. Headquartered in Reston, Virginia, Octo builds flexible solutions that evolve as missions change, delivering results that last. Octo is an Arlington Capital portfolio company. www.octoconsulting.com.
Connexta is a software development company delivering enterprise integration services to government and commercial customers globally. Connexta develops secure, distributed intelligence processing capabilities, breaking down proprietary restrictions to enable information sharing. Connexta is headquartered in Phoenix, AZ, USA with operations in Colorado, Massachusetts, and the Washington DC metro area. www.connexta.com.