When you’re 113 years old and still going strong, it could be because of the company you keep — and the companies you possess. In June 2007, Harris Corp., which was founded in 1895, acquired Multimax Inc., a supplier of network-centric information technology and communications services. With the $400 million Multimax buy, Harris substantially boosted its IT offerings by adding more than 1,000 employees and creating a new business unit, Harris Information Technology Services.
The company ranks No. 13 on this year’s Top 100 list with $1.9 billion in 2007 prime contracting revenue.
“The biggest trend in acquisitions is targeted capabilities,” said Jeremy Wensinger, group president of Harris Government Communications Systems. “People are going after gaps in their portfolios.
The niche companies — we call them tuck-ins — can deliver whole new solutions to the customer.”
Harris’ new group continues to work primarily at customer locations, supporting a portfolio of mission- critical network infrastructure programs that serve more than 800,000 users at some 3,800 locations in United States and overseas. A large portion of the workforce is technically certified, and about 85 percent have security clearances.
Multimax customers that transferred to Harris include the Navy, Marine Corps, Air Force, Army, Federal Aviation Administration and Homeland Security, State and Veterans Affairs departments. The acquisition establishes Harris as a critical player on major awards, such as the Navy Marine Corps Intranet program, where it is a subcontractor to EDS Corp. Multimax also brought large task-order contracts, such as the Network Centric Solutions contract by the Air Force and the Enterprise Acquisition Gateway for Leading Edge Solutions contract at the Homeland Security Department.
“From the day we acquired them, they hit the ground running and contributed,” Wensinger said. “Our IT service has basically doubled.”
Other areas of Harris concentration include radio-frequency and broadcast communications; defense-related services, equipment and integrated systems; and intelligence, surveillance and reconnaissance technologies. The company counts nearly 7,000 engineers and scientists among its 16,000 employees.
“We have been bullish on Harris and still are, based on the fundamentals,” said David Weissman, senior telecommunications analyst at Zacks Investment Research Inc. in Chicago.
In March, the National Security Agency awarded Harris a five-year, $41.6 million contract to build top-secret wireless networks for federal agencies and other approved customers. The technology is designed to be interoperable with other military platforms, such as the Army’s Warfighter Information Network- Tactical, Command Post Platform and Joint Network Node programs.
Weissman said he credits Harris with a savvy balance between public- and private-sector business so risk is minimized. Overall, the company had $4.2 billion in 2007 revenue. About 80 percent of Harris’ business is in the United States. Of that, 46 percent is government-related and 54 percent is commercial. Annual growth during the past five years has been in the double digits, averaging between 17 percent and 19 percent. Weissman projects 20 percent growth for the remainder of 2008.
“Harris is exploiting their relationships with government clients, on both the defense and civilian sides,” Weissman said. “They also have significant relationships with major defense contractors like General Dynamics, Lockheed Martin and Northrop Grumman. That adds a level of security for their recurring revenue streams.”
One of the company’s concerns is keeping the pipeline full of younger technologists. Wensinger said Harris is aggressively supporting college-level courses in fields such as cybersecurity and information assurance at schools such as the Florida Institute of Technology and the University of Central Florida.
“For us to maintain our technology edge, we have to support higher graduating numbers of engineers,” he said. “Then we have to attract them to the aerospace and defense industries. You need to build relationships with kids early on. The sooner and the more they know about you, the more excited they’ll get about the work they will be doing.”
