B2G is moving!
Blogs posted after May 22, 2015 will be located on Deltek's central blog page at
Just select the "B2G Essentials" blog to continue to receive this valuable content.
Dynamics Research Corp. (DRC) to buy Kadix Systems LLC

Kadix Systems will exit the 8(a) business development program earlier than April 2012.

Announced today, DRC (NASDAQ:DRCO) will acquire Kadix Systems LLC of Arlington, VA for at least $42 million.


In 2007 Kadix reported revenue of $23 million and net income of $3.8 million, according to the company. With consideration of at least $42 million, Kadix earns a very attractive multiple of at least 1.8x 2007 revenue.

No small feat, Kadix is CMMI Level 3 certified. DRC is also CMMI Level 3.

Civilian and Homeland Security Gains

With this acquisition DRC gains ground in civilian agencies to complement its defense presence, a move to strengthen civilian market share that is becoming more common as vendors position for war spending and administration changes. DRC's top 4 customers are in defense, accounting for over 85% of its FY07 reported prime obligations.

Kadix will jump start DRC's $2M to $3M per year DHS prime business. Roughly half of Kadix's FY07 prime obligations are from Homeland Security. While both have prime contracts on DHS' go-to EAGLE contract vehicle, Kadix has had more success with it and also has a seat on DHS' new Program Management Support Services (PMSS) contract.

Kadix Prime Contracting Growth

Strong prime obligations growth in last 5 years (Kadix entered the 8(a) program in April 2003):

Fiscal Year $K
2003 $1,689
2004 $7,374
2005 $9,039
2006 $14,920
2007 $25,285
Source: GovWin FPDS Vendor Profiles

Comments (Comment Moderation is enabled. Your comment will not appear until approved.)