Guidehouse to Acquire Navigant Consulting in $1.1 Billion Deal, Creating a New Powerhouse in Healthcare and Regulated-Sector Consulting

VCBeat (WeChat ID: vcbeat) has learned from foreign media that Guidehouse, a portfolio company of Veritas Capital and a leading provider of management consulting services to U.S. government clients, recently announced it had signed a definitive agreement to acquire Navigant Consulting (NYSE: NCI) in a transaction valued at approximately $1.1 billion.

Under the terms of the agreement, Navigant shareholders will receive $28 in cash per share. The acquisition price represents a 16% premium over the company’s closing share price on August 1, 2019 (the last trading day prior to the announcement) and a 26% premium over its 90-day volume-weighted average share price. Subject to regulatory approvals and customary closing conditions, the transaction is expected to be completed in the fourth quarter of this year.

Navigant Consulting, founded in 1983 and listed on the New York Stock Exchange on October 11, 1996, is a professional global services firm. Navigant’s professionals leverage deep industry knowledge, proprietary technical expertise, and a proactive approach to help clients create, manage, and protect business value.

The company focuses on providing a suite of consulting, outsourcing, and technology analytics services to healthcare, energy, and financial services firms facing transformational change and significant regulatory and legal pressures, thereby identifying business opportunities and safeguarding the best interests of these clients. Navigant excels at rapid expansion through mergers and acquisitions, having acquired 41 companies since its inception, with M&A activity concentrated in the healthcare sector over the past five years. From 2014 to the present, Navigant has consecutively acquired six companies, four of which operate primarily in healthcare-related fields and one in biotechnology.

Navigant’s annual revenue is approximately $682 million, with its main competitors including DSW, FTI Consulting, and PA Consulting Group. The merged entity will integrate the two companies’ operations in highly regulated industries, focusing on meeting the needs of clients in sectors such as healthcare, financial services, energy, national security, and defense aerospace.

The new company will be led by Guidehouse CEO Scott McIntyre and the business team leaders of both companies. “Acquiring Navigant is part of our plan to create a next-generation global consulting business,” said Guidehouse CEO Scott McIntyre. “Navigant is a highly powerful management consulting and services firm, with top-tier talent in healthcare, energy, and financial services, capable of addressing the most complex business challenges faced by clients. With complementary strengths in our focus areas, we are well-positioned to continue delivering innovative solutions that help government and commercial clients tackle some of their most pressing challenges while providing resilient services. The new company combines a best-in-class portfolio, high-caliber teams, and a digital-first business model. We look forward to the journey ahead as a combined entity.” Julie Howard, Chair and CEO of Navigant, shared her views on the merger.

Julie Howard further elaborated on the value of this merger and acquisition: “After analyzing the company’s strategic alternatives and evaluating proposals from various potential strategic and financial partners, the Navigant Board of Directors unanimously agreed that Guidehouse’s acquisition offer provides immediate and specific value at a highly attractive premium. Selling the company to Guidehouse is in the best interests of Navigant’s shareholders. The combination of Navigant and Guidehouse will create a powerful global consulting firm with deep industry expertise and leading technical knowledge. The two companies share aligned corporate cultures and core values. Through this integration, our employees will enjoy broader growth opportunities, and clients will gain access to a wider range of expertise and technical tools to achieve their objectives.”

“Guidehouse and Navigant are both leaders in their respective markets. Today, the merger of the two companies will create a new and highly differentiated platform with capabilities and expertise in commercial and public sector consulting. The market entry of this new enterprise, with its comprehensive expertise and scale, gives us confidence in future growth,” said Ramzi Musallam, CEO and Managing Partner of Veritas Capital.

Veritas Capital is a leading private equity firm that primarily invests in companies delivering critical products and services—primarily technology and technology solutions—to global government and commercial clients. These companies are predominantly concentrated in the aerospace and defense, healthcare, national security, communications, energy, government services, education, and related operational sectors.

Guidehouse employs approximately 2,000 professionals across more than 20 offices in the United States. It is a leading provider of strategic consulting services to U.S. government agencies—including, but not limited to, the Department of Defense, the Department of Homeland Security, the Department of Veterans Affairs, the Department of Health and Human Services, and the Department of State—as well as numerous state and local governments. Led by professionals with deep expertise in both the commercial and public sectors, Guidehouse helps clients address their most complex challenges.

Reference Link:

https://www.crunchbase.com/organization/navigant-consulting#section-acquisitions