Steve Guy, Director at KPMG Corporate Finance, quoted in Factset Mergerstat's Flashwire Weekly

December 18, 2006

In the December 18, 2006 edition of Factset Mergerstat's Flashwire Weekly, KPMG Corporate Finance had an opportunity to contribute to Mike Angell's article, As Outsourcing Grows, More Consolidation Expected in Government and Defense Industries.  Angell discusses how there are opportunities for consolidation despite the decline this year in M&A activity among defense and government contractors. 

Steve Guy,  Director at KPMG Corporate Finance, was quoted with respect to his views relative to the latest trends in the defense and government IT sectors, specifically, decreased spending, growth in services revenue, and seizing an opportunity to enter in the services sector through acquistions.

According to Guy, "the large prime defense contractors are looking for ways to diversify away from selling products and services." Guy adds, "...it can take anywhere from 18 to 24 months to get the security clearances." "The much quicker route to getting the business is through acquisitions."

Mike Angell further comments on the success of recent public offerings of three defense and IT contracting firms. "The offerings signal further confidence in the industry.” "There are political risks for government contractors in terms of where spending is going." Guy said. "But the U.S. as a customer is not going to go away.  If anything, it will likely outsource more."

About KPMG Corporate Finance LLC

KPMG Corporate Finance LLC is a leading financial adviser serving domestic and international clients. KPMG Corporate Finance offers a full suite of investment banking and advisory services and the experience and depth of knowledge in global M&A and project finance to advise clients on mergers and acquisitions, sales and divestitures, buy-outs, financings, restructurings, fairness opinions, infrastructure project finance and other advisory initiatives. Operating in 52 countries, KPMG's Corporate Finance practice comprises more than 1,600 professionals who are able to meet the needs of KPMG's firms’ clients across the globe. In 2005, KPMG's Corporate Finance practice was ranked the number one financial adviser for completing the highest number of transactions globally (429 deals totaling US$40.3 billion), according to Thomson Financial’s global M&A league tables, and in 2006 it was named global financial advisor of the year by Infrastructure Journal.