The August 2016 acquisition of Vistronix Intelligence and Technology Corporation by ASRC Federal caught a lot of people by surprise, for a number of reasons. ASRC Federal, the government services business of Arctic Slope Regional Corp., an Alaska Native Corporation, had made some deals within the federal government contracting space, but nothing significant until its purchase of Vistronix. The Vistronix acquisition made a bold statement to the market that ASRC is here and ready to compete. The deal was recently recognized by ACG National Capital as the $50M-$250M “Deal Of The Year” at the recent Corporate Growth Awards black tie gala.
Prior to the Vistronix acquisition by ASRC Federal, Vistronix was a serial deal maker and acquirer, with six acquisitions over the course of three years, building out capabilities around big data and analytics, ISR, cloud computing as well as robust footprint in intelligence and community customers. The addition of Vistronix added these capabilities to the ASRC portfolio, and better positioned them to compete in the crowded and competitive government marketplace.
At this year’s Mid-Atlantic Growth Conference, which was sponsored by the National Capital Chapter of the Association for Corporate Growth, John Hassoun, former CEO and President of Vistronix, Mark Gray, President of IT Business at ASRC and Ron Jones, former Chief Strategy Officer at Vistronix, came together to speak about the acquisition. During their panel discussion, they shared best practices for creating a platform for growth, choosing M&A targets, organic growth and creative financing.
When it comes to creating a platform for growth, Ron Jones advises companies to have a strategy and blueprint in place that brings value, and stresses the importance of having the right people to support that strategy in order to raise the capital that is needed. In 2012, Vistronix quadrupled its revenue from $40 million and more than tripled its employees from 200 to 700. John Hassoun, CEO of Vistronix at the time, says the company faced big challenges as they transitioned from a $40 million company to a $160 million organization in such a short period of time.
He says you really have to ask yourself “are you willing to let go of the tough day-to-day decision making and trust someone else to take over for you?” and adds that a large part of their success with the transition during the acquisition was being able to make the management changes necessary by hiring and realigning the right talent able to focus on integration.
When ASRC Federal began looking at Vistronix from an acquisition perspective, they were, at the time considered by many a ‘non traditional’ acquirer having made only two deals in the year and a half prior to the Vistronix acquisition. These deals took place after five years without any acquisitions. Mark Gray, the current CEO and President of ASRC Federal says when they looked at strategic gaps from a market and capability standpoint, the Vistronix acquisition was a perfect fit, as they had built a business focused on mission critical technologies and other core capabilities that ASRC could not fulfill alone. Mark says Ron Jones and John Hassoun taught him a lot about strategy and that Vistronix “built a tremendous business focused on real mission sets in the intelligence community, a notable gap in our portfolio.”
Now with deals like the Vistronix acquisition under ARSC Federal’s belt, their position as an acquirer may soon change. In order to be characterized as one, Mark believes there are some key best practices organizations should follow. He advises organizations to identify “where the gaps are between where the primary spaces are in the market and where you want to be, and the current resources and capabilities [other companies] have”, and says “that’s precisely what we did.” Mark also notes the importance of partnership when it comes to deal making and corporate growth and adds, “We spent a long time getting to know each other. It’s been a great deal for us.”