L1 to acquire SpecTal for $100m.
STAMFORD, Conn.--Less than two weeks after Viisage and Identix merged to form L1 Identity Solutions, the new entity on Sept. 11 entered into an agreement to acquire government consulting firm SpecTal for $100 million.
SpecTal will help biometric giant L1 achieve a strong federal presence and "product pull-through to the customer who is the federal government, those who allocate dollars in the fight against terrorism," said Doni Fordyce, L1's executive vice president, corporate communications.
The acquisition is expected to close next month and will be funded primarily by bank debt. SpecTal may earn an additional $10 million "if key performance thresholds are met."
With approximately $140 million in backlogged business, SpecTal projects $60 million in revenue and $9 million in EBITDA for the 2006 calendar year. The closing is subject to regulatory approval.
Founded by the husband and wife team of John Cross and Louise Brouillette, SpecTal is a privately held corporation, based in Reston, Va., that provides comprehensive security and intelligence solutions, specializing in government consulting, training and technology development.
SpecTal's 325 employees will all be retained. Staff members are former CIA and DoD officials and veterans from the intelligence community; 95 percent of the staff has top secret security clearances.
Fordyce expects SpecTal to be instrumental in helping L1 enhance its product line used for counter-terrorism. As an example, she said SpecTal could assist with future development of the HIDE device. Produced by L1's subsidiary, Securimetrics, HIDE is used by the U.S. government in Iraq. The mobile device captures biometric information and transmits it back to a database to verify a person's identity. (Securimetrics on Aug. 10 received a $10 million DoD contract for the devices.)
Ann Holcomb, who is currently vice president, will become president of SpecTal. Ron Hammond and Ed Balint will continue as executive vice presidents.
"We think SpecTal offers us a tremendous opportunity for growth and we think we can help them perhaps spread their reach with our current customer contacts," such as foreign governments L1 now works with, Fordyce explained.
When Robert LaPenta outlined his plan to build a comprehensive biometric company, he said the first phase would entail acquiring technology companies. That phase is largely complete, although there may be some small acquisitions of technology companies in the near future, Fordyce said. Look for more non-technology acquisitions in L1's current post-merger second phase, Fordyce said.
"There's no resting here. We have a lot in the pipeline," Fordyce said.
For more on this story, including an interview with John Cross, see the November issue of Security Systems News.