ICF International Acquires Z-Tech Corporation
Fairfax, VA, June 28, 2007 - ICF International (NASDAQ: ICFI) today announced it has acquired Z-Tech Corporation (Z-Tech), an approximately 200-person firm that provides software engineering, Web design and development, and scientific computing services in support of federal health agencies. The purchase price included a US$27 million cash payment at closing and an additional $8 million in potential earn-out payments. ICF International expects Z-Tech to generate annual revenues of approximately $25 million going forward and for the acquisition to be immediately accretive to earnings.
The acquisition of Z-Tech positions ICF as a leader in the high-growth market of health information technology. By combining Z-Tech’s technology and program support expertise with ICF’s established presence in health communications, policy, and clearinghouses, the company gains a significant business edge in serving the large federal health care market, which is estimated at more than $25 billion.
Z-Tech primarily provides services to the five main agencies of the U.S. Department of Health and Human Services, including the National Institutes of Health, Centers for Disease Control and Prevention, U.S. Food and Drug Administration, Substance Abuse and Mental Health Services Administration, and Centers for Medicare and Medicaid Services.
“This transaction illustrates one key element of our growth strategy—to expand our capabilities into key high growth markets through the strategic acquisition of top quality, well-managed companies that enhance the solutions we can offer our clients,” said Sudhakar Kesavan, chief executive officer at ICF. “In addition to significantly enhancing our IT capabilities, Z-Tech brings established client relationships within the agencies of the Department of Health and Human Services that give ICF important inroads to developing major new business opportunities.”
“We are pleased to have found a firm with a like mission to do meaningful work that improves the quality of life, and one with a similar commitment to public health,” said Verl Zanders, founder of Z-Tech. “ICF’s established reputation in federal, state, and local contracting and broad geographic presence offers unparalleled opportunities and outlets for many services across the suite of Z-Tech capabilities.”
Z-Tech, headquartered in Rockville, Md., specializes in software engineering and systems integration, scientific computer modeling and simulation, bioinformatics and genomics, Web design and development, public health research and policy support, and grants management systems in the health sciences and scientific support communities. Its multidimensional approach to business focuses on the application of its technology capabilities as fundamental across all functional service areas to provide the optimum and total solution to its clients. Its principals and senior staff have in-depth experience and understanding of business practices within the federal government. The present management team and employees will remain with the company following the completion of the transaction.