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Maximus to Acquire US Federal Citizen Engagement Centres for USD 400m in Cash
Thursday 11 October 2018

11 October 2018 - US-based government services provider Maximus (NYSE: MMS) has signed a definitive asset purchase agreement to acquire certain assets of General Dynamics Information Technology's (NYSE: GD) large-scale, citizen-engagement centres in the US Federal civilian market, the company said.

The acquisition is expected to strengthen Maximus position in the administration of federal government programmes across the United States.

Maximus said the USD 400m all cash transaction is expected to close in mid-November and is subject to customary closing conditions.

The associated assets included in the asset purchase agreement had revenue of approximately USD 670m for the twelve months ended June 2018.

This revenue is primarily tied to cost reimbursable contracts and accordingly, operating margins typically average in the mid-single digit range.

Maximus expects that the transaction will close in mid-November, subject to customary closing conditions. Maximus currently anticipates that the assets associated with this transaction will generate approximately 10.5 months of revenue for its fiscal year 2019 in the range of USD 575 m to USD 600 m.

The transaction is expected to be accretive by USD 0.10 to USD 0.15 of diluted earnings per share in fiscal year 2019 after consideration of one-time expenses, interest, non-cash charges, and cost synergies.

Since 1975, Maximus has offered business process management and technology solutions.

With more than 20,000 employees worldwide, Maximus is a partner to government agencies in the United States, Australia, Canada, Saudi Arabia, Singapore and the United Kingdom.
Details
Date Published: 11/10/2018
Target: Large-scale, citizen-engagement centres in the US Federal civilian market
Country: USA
Deal Size: 400m (USD)
Sector: Business and Consumer Services
Type: Corporate acquisition
Financing: Cash
Status: Agreed
Vendor: General Dynamics Information Technology
Buyer: Maximus
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