News & Events

Industry Week in Review – May 6, 2016

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Aerospace & Defense Update

The prototype rotorcraft vying to replace the Army’s Black Hawk is scheduled to take its first flight in 2017.  The prototypes are being developed for the Army’s Joint Multi-Role Technology Demonstrator project, commissioned in 2013 after considering various new technologies, by a Sikorsky and Boeing team and Bell Helicopter.  The project will be a part of the Army’s Future Vertical Lift program, a vast effort to replace all helicopters, which include the AH-64 Apache, CH-47 Chinook, and the OH-58.  In order to meet the Army’s shifting needs the rotorcraft will be designed to fly higher, faster, and farther with increased cargo capacity.  Sikorsky and Boeing are currently building the SB-1 Defiant, a high-speed coaxial helicopter, and Bell is building the V-280 Valor, a tiltrotor aircraft.  Both are slated for their first flights in the latter half of 2017 with first orders from the army expected in 2030.

The Association for Unmanned Vehicles Systems International (“AUVSI”) hosted XPONENTIAL 2016 in New Orleans, with more than 8,000 industry leaders and professionals from over 55 countries in attendance to discuss the latest innovations in the unmanned systems market.  The conference, which acts as a platform for providing information about the future of unmanned systems policy, regulations, and technology, featured an announcement from Federal Aviation Administration (“FAA”) Administrator Michael Huerta regarding a new drone advisory committee to be chaired by Intel CEO Brian Krzanich.  As a first step towards easing regulation, the FAA will allow students to operate unmanned aerial systems.  The drone advisory committee anticipates the measure to spur innovation, with the ultimate goal of positioning the U.S. as a leader in the marketplace.  The committee also plans to help identify and prioritize integration challenges and improvements.

Government Technology Solutions Update

Information security incidents at Federal agencies experienced double digit growth in 2015, despite agencies taking increased measures to better protect networks, according to the FY2015 Office of Management and Budget’s (“OMB”) report to Congress on information security.  A total of 77,200 incidents were reported in 2015, up from 69,900 reported in 2014.  While cyber attack incidents still grew at double digit levels in 2015, the growth was less than any other year since 2003.  External scans, probes, and attempted access accounted for the majority of incidents, followed closely by insider threats, such as policy violations and equipment loss.  The sheer number of reported incidents, as well as the continuation of significant year-over-year growth, reinforces the growing need for more effective network monitoring and automated security tools to better prevent and address threats.

Federal Agencies are attempting to minimize the lag between when they receive data and when they analyze data by more effectively using big data analytic methods.  Agencies have sought to increase the manpower at their disposal through analysis training programs, but the amount of data limits the effect of increased manpower.  By reaching out to industry partners, agencies have been slowly decreasing this data analysis lag.  The Department of Homeland Security (“DHS”) has decreased its analytical backlog to around one month, while Centers for Medicare and Medicaid Services (“CMS”) has decreased its lag time from one year to three months by utilizing real-time analysis techniques.  In order to better utilize the sheer amount of data at their disposal, agencies are looking for creative solutions from industry partners while increasing the cyber manpower available within the Federal government, a trend that will likely continue over the near term.

Big Movers

Kratos Defense & Security Solutions (Down 19.4%) – Shares were down this week after the company reported weak earnings for the first quarter

Tutor Perini (Up 22.9%) – Shares were up this week after the company reported increased project opportunities in its earnings report

Transactions

Altamira Technologies Corp acquired Prime Solutions LLC, a provider of engineering and information technology services.  Terms of the deal were not disclosed.

Convergint Technologies, LLC. acquired Total Recall Corporation, a provider of citywide surveillance networks.  Terms of the deal were not disclosed.

DLH Holdings Corp acquired Danya International, Inc., a provider of evidence-based health, education, and food security technology-enabled solutions.  The transaction was valued at $38.8 million.  KippsDeSanto & Co. acted as the exclusive financial advisor to Danya International, Inc.

Fortem Technologies acquired the Detect and Avoid Radar Technology Line of IMSAR, LLC., a provider of collision avoidance radar for UAS.  Terms of the deal were not disclosed

FTG Circuits, Inc., to acquire the Printed Circuit Technology Business of Teledyne Technologies, a provider of rigid-flex printed circuit boards and assemblies.  The deal is worth an estimated $9.3 million.

PEI-Genesis, Inc. acquired Filconn, Inc., a provider of filtered, electromagnetic pulse suppression, and custom configuration connectors.  Terms of the deal were not disclosed

Silverfleet Capital to acquire Sigma Precision Components Ltd., a provider of precision components for aerospace and high technology markets.  The deal is worth an estimated $91.2 million.

UES International Pty Ltd., acquired Panther Engineering, Inc., a provider of design, engineering, and high precision CNC parts, tooling, dyes, and molds.  Terms of the deal were not disclosed.

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