On Friday, February 22, 2019, ACG National Capital will be sponsoring its February Monthly Meeting, which will feature a panel discussion entitled, “Transformational Transactions: Making Big Moves with M&A.”
This panel discussion will be moderated by Marc Marlin, a managing director at KippsDeSanto & Co. and will give members and guests an opportunity to learn about executing and completing transformational M&A transactions from some of the region’s leading experts. These experts include:
- Chris Donaghey, Senior Vice President for Corporate Development, SAIC
- Sid Fuchs, President, MacAulay-Brown, Inc., an Alion Company
- Carey Smith, Chief Operating Officer, Parsons
We recently sat down with Mr. Marlin to get his idea of what makes an M&A transaction “transformational.” We also talked about why these panelists are qualified to talk about executing truly transformational M&A deals, and what ACG members and guests can expect to learn from the panel discussion.
Here is what Mr. Marlin had to say:
Corporate Growth, Capital Style (CGCS): Can you tell our readers a little bit about yourself and your work with Kipps DeSanto?
Marc Marlin: I’m a managing director at KippsDeSanto and lead our technology solutions practice, which focuses on software, services or tech-enabled services.
KippsDeSanto is an investment bank that focuses on technology solutions and aerospace and defense companies in the middle market. We are headquartered in Tysons Corner, Virginia, but we have a national practice. We’re best known for our sell-side M&A practice, working with company owners, private equity funds and supporting corporate divestitures.
CGCS: Next week you’ll be moderating the Transformational Transactions: Making Big Moves with M&A discussion. What makes a transaction transformational in your mind?
Marc Marlin: In my mind, a transformational transaction is anything that dramatically accelerates a company’s strategic roadmap. Most companies have plotted out the trail that their organization will take in that roadmap. A transformational deal is something that really pulls that timeline forward and broadens the aperture of what market opportunities the combined companies can take advantage of.
Maybe a strategic roadmap would deliver a certain solution to a certain customer set by a given point, but once you do a transformational deal, you’d have more solutions that can be delivered to that customer set or you would gain additional customers for those solutions. Businesses post a transformational deal gain a true competitive edge compared to where they were beforehand.
CGCS: There are three panelists participating in the discussion with you next week: Why are these individuals uniquely qualified to talk about transformational transactions?
Marc Marlin: They cover the entire spectrum of transformational M&As from private, to public, to family- and private equity-owned. They really cover everything.
Chris Donaghey is from SAIC, which recently acquired Engility, your classic, big public-to-public deal. It’s a very strategic, large scale, public market opportunity.
Carey’s company, Parsons, is itself going through transformation from a legacy engineering and construction firm to a higher-end technology defense contractor. As part of that strategic roadmap, they’ve made a real commitment to the defense and intelligence community. She’s recently done a number of deals that gives her critical mass and capability in those markets.
Sid Fuchs might be the most interesting for our discussion. He’s an exceptional leader as a CEO and because of his strategic insight and vision of acquisitions that afforded him the capability to artfully transform his business, MacAulay-Brown, into a transformational deal for somebody else, Alion. So, he’s been in transformational transactions as both the buyer and seller, so to speak.
CGCS: What do you think ACG members and their guests will gain from attending the monthly meeting? What lessons and best practices do you think they’ll learn?
Marc Marlin: ACG Capital Region is the go-to organization for folks that do deals, whether you’re the capital provider, an advisor, or the dealmaker itself. I think what folks will really gain is some inside baseball around the deal. How do you think about it strategically? How do you execute it from the strategic roadmap perspective? And, most importantly, how do you succeed on the back end? We’re going to talk about lessons learned and recipes for success.
The deal itself is the tip of the iceberg. Everyone likes to do a lot of back-slapping when the deal closes, but really the celebration should be when you know things work and the deal has achieved its goal. I think what’s really exciting about this panel is that we’ll get to unpack the entire life cycle of a deal from the strategic roadmap to how do you make sure it’s successful on the back end.
CGCS: Is now a particularly good time to have this discussion? Are there a lot of opportunities for M&A and transformational transactions in the region right now? And if so, what’s driving that?
Marc Marlin: Overall, the market’s pretty active. It helps when the macroeconomic forces, like the economy and the stock market, are doing well. The credit markets have gone up and down, but, generally speaking, there’s a lot of capital available for deals.
When there’s stable or optimistic views on the broader market, folks think about longer-term investments and have the confidence to make decisions that are longer term in nature. That’s the thing about M&A; it’s not a quick hit. When you do M&A, you’re making a long-term investment.
When you look at the stability in the market right now and the confidence of many corporate leaders, both in our region and more broadly, M&A becomes a more actionable and more attractive alternative for capital.
In this region, specifically, a big part of ACG National Capital’s constituency are government contractors. The government contracting market is very active, as the industry is strong. Setting aside the shutdown for a moment and this administration’s somewhat polarizing style- government contractors have done well in this administration.
Stock prices have been trending around multiyear highs as they’ve returned to growth. When smaller companies are successful, they look to sell for diversification and strategic heft, and bigger companies will start to lean in on the acquisition front.