WidePoint expects the acquisition of AGS to contribute $10m to $11m in revenue for the full year 2012
Wireless mobility management and cybersecurity offerings firm WidePoint has acquired communications lifecycle management services, technology, and offerings provider Avalon Global Solutions.
Under terms of the acquisition agreement, WidePoint paid $7.5m in cash at closing on December 31, 2011, and will pay up to an additional $4m in cash over approximately three years if certain financial targets are achieved.
WidePoint management expects the acquisition of AGS to contribute at least $10m to $11m in revenue for the full year 2012.
WidePoint funded the AGS asset purchase with senior debt provided by Cardinal Financial Bank through a five-year, $4m note accruing interest at 4.5% annually; two sellers notes accruing interest at 3% annually for $1m and $3m payable over approximately three years; with the $3m note having claw-back provisions for up to the value of the note tied to minimum financial performance targets in 2012 and 2013; and cash provided by the company.
WidePoint CEO Steve Komar said WidePoint’s strategic goal has been to expand the TEM offering into the commercial market, leveraging the reputation and expertise WidePoint have built in the government sector.
"This acquisition will significantly accelerate that effort while simultaneously providing added scale and incremental profitability," said Steve.
AGS CEO Michael Mansouri stated the combination of the compaies platforms enhances both companies as AGS further bolsters WidePoint’s position as the largest provider of automated system based communications lifecycle management services to the U.S. Federal Government.
"The addition of WidePoint’s cybersecurity offerings also provides us with an opportunity to introduce new services for our commercial clients as we witness the increasing requirements for security protections for wireless devices, an area in which WidePoint has existing and proven expertise," said Mansouri.