Q3 2023 Acquisitions

Q3 M&A REPORT Q3 2023
Q3 2023
M&A Insider Report

Defense, Government Physical & Cyber Critical Maritime Transport
& Intelligence Security Infrastructure & Facilities
©The
2023McLean
The McLeanGroup
Group. All rights reserved. McLean Group LLC | 1660 International Drive | Suite 810 | McLean, VA 22102 | (703) 827-0200 | www.mcleanllc.com
Securities transactions
Premier middle market conducted throughbank
investment McLean Securities, LLC, member FINRA/SIPC
TMG OVERVIEW QUARTERLY UPDATE Q3 2023
FIRM OVERVIEW INDUSTRY FOCUSED M&A
• Founded in 1997 and Government Services Physical & Cyber Security

• Government Services and Products • Physical Security Services
headquartered in Northern VA;
• Federal Civilian Services • Integrators
25-year history of transaction • State and Local Government • Cyber Security
success
Critical Infrastructure Maritime
• Comprised of 50+ financial • Vessels
• Water & Wastewater
professionals across five offices • Energy Infrastructure • Tier Two & Three Services
• Critical Communications • Ports & Facilities
• Team includes career

investment bankers, CPAs,
certified business valuation
professionals and former
industry executives
CORE BUSINESS 360 FINANCIAL COVERAGE
Investment Banking • Sell-Side M&A 140+ > 400

Strategic Advisory Services • Buy-Side M&A Closed Transactions Since Annual Valuation Clients
• Debt / Equity Placements 2010
• Employee Stock Ownership Plans
• Leveraged Transactions
• Other Advisory Services
> 25 yrs. 50+
Track Record of Success Financial Professionals
Business Valuation • “Fair Value” Financial Reporting

Valuations and Opinions • Equity Incentive Plans
>90% > $8B

• Fairness Opinions
• PEG Portfolio Valuations
• ESOP Transactions
• Estate and Gift Portion of Deals that are Total Transaction Value
Sell-Side M&A Since 2010
The McLean Group

Premier middle market investment bank 2
Q3 M&A REPORT QUARTERLY UPDATE Q3 2023
Major News Stories

Inflation Remains Above 2.0% Fed Target
─ CPI inflation remains stubbornly high, with the latest data showing a slight uptick to 3.7% in August compared to 3.2%
in July. Core CPI, which excludes food and energy, rose 4.3% year-over-year.
─ Month-over-month gasoline prices jumped 10.6%, but compared to a year ago, prices are down 3.3%. The Fed kept
interest rates unchanged in September and signaled one more hike before year-end, as well as fewer cuts next year
than previously indicated.
IPO Market Shows Signs of Life

─ British semiconductor and software company Arm Holdings priced its IPO at $51 per share, raising nearly $4.9 billion.
Even with SoftBank retaining 90% ownership, the equity offering will be one of the largest this year.
─ In September, Maplebear Inc., owner of Instacart, went public through an IPO. The initial share price range was $26-
$28, but due to high demand, the price was increased to $30. The IPO was successful, raising $660 million and
indicating a fully diluted valuation of $9.9 billion.
PE Turns to Add-on Acquisitions with Troubled Economy
─ PE firms are shying away from big-ticket LBOs because of expensive debt and a lack of exit opportunities, turning to
add-on acquisitions in order to meet capital deployment mandates and achieve margin expansion.
─ Add-on levels reached all-time highs in 2022 and remained elevated through Q3 2023 as it has become more difficult to
grow organically with an uneasy market.
Government Shutdown Temporarily Averted

─ Republicans and Democrats reached a last-minute deal on September 30th to fund the federal government for 45
additional days. This temporary solution will give representatives more time to work through contentious issues to
reach a long-term funding agreement.
─ Former Speaker McCarthy was experiencing elevated scrutiny from fellow Republicans as he tried to navigate issues
such as funding for the Russia-Ukraine war.
The McLean Group

Q3 M&A REPORT QUARTERLY UPDATE Q3 2023
Institutional capital continues to flow to Private Debt
─ In the first half of 2023, institutional funds in the private debt space closed on approximately $95 billion in committed capital, surpassing the
$91.4 billion raised during the same period last year.
─ Fundraising is on pace to exceed the $200B mark again in 2023, which would be the fourth consecutive year of doing so. With the recent uptick
in funding, private debt now exceeds venture capital as the private market strategy with the highest fundraising totals, second only to private
equity.
─ In 2022, larger, more-experienced managers accounted for over 30% of total fundraising. Through the first half of 2023, it appears that the
market is broadening with emerging managers entering the space. Emerging managers, defined as having three or fewer funds, accounted for a
12.8% market share and two of the ten largest closed funds through H1 2023.
─ From a geographical perspective, fundraising in North America accounts for the majority of private debt funding, accounting for 75.4% of global
activity, which is an increase from 69.6% for the entirety of 2022.
ANNUAL INSTITUTIONAL PRIVATE DEBT FUNDRAISING ACTIVITY ($B)
$271B
$202B $212B $203B

$177B $175B
$146B
$117B $124B
$103B $95B
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023*
Sources: PitchBook, Bloomberg, Reuters

* As of 6/30/2023
The McLean Group

Q3 M&A REPORT DEFENSE, GOVERNMENT & INTELLIGENCE Q3 2023
─ On September 30th, President Joe Biden signed a temporary TRANSACTIONS BY MONTH

funding bill to keep government agencies open and avoid a Q4 2022 Q1 2023 Q2 2023 Q3 2023
35 34 53 53
federal government shutdown. The bipartisan package funds the
government at current 2023 levels until mid-November but does
21
drop current aid to Ukraine. However, the bill does include an 19 18
16 17 17
increase to federal disaster assistance by $16 billion, meeting the 14
13 13
President’s full request. 11 10
─ Now that the latest CIO-SP4 protests have been resolved, nothing 6
remains in the way of the NIH Information Technology
Acquisition and Assessment Center (NITAAC) making its awards.
As a result of the protest, the NITAAC is taking corrective action,
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performance. This will change the point totals for many of the EBITDA VALUATION MULTIPLES 1
companies who submitted for the vehicle. Re-evaluations are
underway, and the NITAAC expects to make the awards before 24.4x
2
the legacy CIO-SP3 vehicle ends in April of 2024. 21.2x

─ The Modernizing Government Technology Reform Act of 2023 17.6x
(MGT Reform Act) will continue through the house after markup 14.8x
12.5x 12.2x 12.5x 11.7x
from the Committee on Oversight and Accountability, the 11.2x
sponsoring committee. The new bill aims to extend funding
through 2030 and reform the original Modernizing Government
Technology Act from 2017, which authorized the Technology
Modernization Fund (TMF) to run through 2025. Along with the
extension, MGT Reform Act will attempt to enforce agencies to Defense Primes Government Contractors Defense Systems
comply with the original intent of the bill and require funds LTM 2023E 2024P
issued to be repaid to maintain solvency of the fund.
Sources: Bloomberg, S&P Capital IQ, FedScoop,

Washington Technology, AP News
1. For composition of indices, see page 26
The McLean Group 2. Kratos was excluded from this calculation
Q3 M&A REPORT SELECT Q3 TRANSACTIONS Q3 2023
Transaction Details Transaction Details Transaction Details2

1
Forcepoint’s Global Bridge Core provides visual Tidal Basin provides
acquired by
Government’s and Critical intelligence, cybersecurity, and comprehensive emergency and
acquired by* Infrastructure (G2CI) business acquired by other technical solutions to the disaster management consulting
supports national security and U.S. government intelligence services including preparedness,
a portfolio
intelligence communities by community. The acquisition is company of mitigation, response, recovery
providing trusted, data-driven expected to serve as a new and program management,
solutions enabling them to platform for NewSpring as they largely in support of FEMA. With
collaborate and conduct reenter the government services the acquisition, Tidal Basin will
Date: 7/10/2023 mission-critical work. The Date: 7/26/2023 space. Bridge Core is expected Date: 8/22/2023 continue to operate as a stand-
acquisition will allow Forcepoint to use the proceeds of this alone entity and will compliment
EV: $2,450 EV: ND EV: ND
G2CI to operate with greater transaction to execute a Michael Baker’s efforts to
EBITDA Multiple: NA flexibility and grow its platform EBITDA Multiple: NA disciplined M&A and organic EBITDA Multiple: NA support the nation’s recovery
globally. growth strategy. efforts and rebuild
infrastructure.
Transaction Details Transaction Details Transaction Details2

OnCore Consulting provides PRKK focuses on providing cross- Blue Force Technologies (BFT) is
merged with acquired by
cloud, enterprise architecture, domain analysis and studies for an aerospace and defense design
project management, custom the U.S. Space Force, IC, Space manufacturing company. BFT is
acquired by
development and other services Security and Defense program, the maker of Fury, a full-sized
a portfolio a portfolio
company of to the public sector in CA. GCOM company of and office of the secretary of (group 5) unmanned aggressor
delivers SaaS platforms, data defense’s strategic capabilities aircraft intended to provide Red
analytics, and IT services to office with operations in D.C., Air adversary training to the U.S.
gov’t customers in support of California, and Colorado. The Air Force. With the acquisition,
Date: 8/29/2023 public safety and economic Date: 9/6/2023 acquisition enables SPA to Date: 9/7/2023 Anduril plans to continue the
development efforts . The further expand its commitment EV: ND
development of the Fury, expand
EV: ND EV: ND
merged entity shares a common to the space and intelligence manufacturing capacity in NC,
EBITDA Multiple: NA goal of bringing digital software EBITDA Multiple: NA sectors and will fall under SPA’s EBITDA Multiple: NA and accelerate development in
platforms and related services to current S&I division. the autonomous technology
the public sector market. space.
Sources: S&P Capital IQ, DACIS, GovConWire

*Announcement Date
1. Forcepoint divested its Global Governments
The McLean Group and Critical Infrastructure (G2CI) business
Premier middle market investment bank 2. TMG served as exclusive financial advisor 6
Q3 M&A REPORT NOTABLE CONTRACT AWARDS Q3 2023
Contract
Award Date End Date Customer Awardee Type Contract Scope
Value ($M)
Bath Iron Works / Fixed Price Design and construction of nine total DDG
$14,600 08/01/2023 06/30/2034 U.S. Navy
Huntington Ingalls Incentive Firm 51Arleigh Burke class destroyers
Firm Fixed Price / Provide rapid procurement of hardware systems,

$7,900 08/31/0223 08/30/2033 U.S. Army Leidos
Cost Plus Fixed Fee components and technology upgrades
U.S. Defense Microelectronics Provide uninterrupted access to secure

$3,127 09/20/2023 09/16/2028 Activity (DMEA) GlobalFoundries Firm Fixed Price semiconductor foundry and manufacturing
Deliver network and exploitation analysis to

$2,700 08/03/2023 07/31/2028 NSA CACI Cost Plus Fixed Fee
secure and defend vital networks
National Advanced Mobility Perform coordinated R&D projects to accelerate

$2,500 07/01/2023 06/30/2033 U.S. Army Firm Fixed Price
Consortium military platform upgrades
Perform individual and household income

$2,190 09/19/2023 09/29/2028 CMS, OAGM Carahsoft Technology Firm Fixed Price verification to determine various eligibilities
NASA Cost Plus Award Fee Provide mission and flight crew operations
$1,930 07/20/2023 09/30/2032 KBRwyle Services
/ IDIQ support for the International Space Station
Provide life cycle services for the U.S. Army

$947 07/11/2023 07/11/2029 U.S. Army Amentum Firm Fixed Price fixed-wing Transport Aircraft (TA)
Support DHS IT O&M, security, design

$918 08/15/2023 09/10/2030 DHS Leidos Cost Plus
optimization, enhancement and testing services
Sources: DACIS, Clearance Jobs, GOVConWire,

U.S. Department of Defense
The McLean Group

Q3 M&A REPORT TMG CUSTOM INDICES Q3 2023
TRAILING TWELVE MONTHS (TTM) PUBLIC EQUITY INDEX CHART 1
40%
30%
20.4%
20% 19.6%
15.9%
10%
2.3%
0%
-10%
Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23
Defense Primes Gov’t Contractors Defense Systems S&P 500

Market Commentary
─ As of the end of Q3 2023, the S&P 500 outperformed The McLean Group's custom indices for Defense Primes and Defense Systems but
lagged slightly behind Government Contracting on an LTM (Last Twelve Months) basis.
─ It's worth noting that the S&P's 2023 gains are top-heavy. Nvidia Corp, the fourth largest component of the S&P 500, has seen TTM share
price growth of approximately 250%. However, the market has experienced a decline since July due to a rise in oil prices and persistent
higher borrowing costs.
─ Despite the rising geopolitical tension and the expected long-term increase in defense spending, there is still uncertainty regarding a long-
term solution for government funding and the amount of aid that will be directed toward countries like Ukraine. As a result, the additional
perceived risk has been priced into defense-related equities.
Sources: S&P Capital IQ, Bloomberg, Seeking Alpha
The McLean Group 1. For composition of indices, see page 26
Q3 M&A REPORT MARKET VALUATIONS Q3 2023
LTM REVENUE VALUATION MULTIPLES
Median: 1.8x
8.9x Mean: 2.4x
4.1x
3.1x
2.7x 2.5x 2.4x 2.3x 2.1x 2.0x 1.8x 1.8x 1.8x 1.7x 1.5x 1.4x 1.3x 1.3x 1.1x 0.9x
HEI TDY MRCY LHX RTX Mean NOC KTOS LMT GD Median BAH ESLT BA. CACI PSN LDOS SAIC VVX
LTM EBITDA VALUATION MULTIPLES
55.5x1 Median: 13.9x

Mean: 18.5x
29.9x 29.8x
27.0x
21.4x
18.5x 18.2x
16.4x 15.3x
13.9x 13.9x 12.8x 11.9x 11.7x 11.4x 11.3x 11.1x 11.1x
8.2x
KTOS HEI MRCY BAH ESLT Mean PSN TDY LHX GD Median CACI LDOS BA. RTX LMT NOC VVX SAIC
Sources: S&P Capital IQ, Bloomberg, Seeking Alpha
1. Not to Scale
The McLean Group

Q3 M&A REPORT PUBLICLY TRADED COMPANIES Q3 2023
DEFENSE GOVERNMENT & INTELLIGENCE

Stock Price Enterprise CY2023E 2024P TEV/2023E TEV/2024P
9/30/23 Value Revenue EBTIDA Margin Revenue EBITDA Margin Revenue EBITDA Revenue EBITDA
Defense Primes
Raytheon 71.97 137,645 72,804 12,934 18% 78,984 14,155 18% 1.89x 10.64x 1.74x 9.72x
Lockheed Martin 408.96 116,861 66,628 9,895 15% 68,572 10,217 15% 1.75x 11.81x 1.70x 11.44x
Northrop Grumman 440.19 80,327 38,727 5,338 14% 40,887 5,760 14% 2.07x 15.05x 1.96x 13.95x
General Dynamics 220.97 70,557 42,506 5,330 13% 45,258 6,033 13% 1.66x 13.24x 1.56x 11.69x
L3Harris 12.18 41,354 30,159 3,997 13% 32,073 4,291 13% 1.37x 10.35x 1.29x 9.64x
BAE Systems 174.12 42,193 19,305 3,468 18% 21,282 3,940 19% 2.19x 12.17x 1.98x 10.71x
Average $221.40 $81,489 $45,021 $6,827 15% $47,843 $7,399 15% 1.82x 12.21x 1.71x 11.19x
Gov’t Contractors
Leidos 92.16 17,827 15,116 1,556 10% 15,789 1,650 10% 1.18x 11.45x 1.13x 10.81x
Booz Allen Hamilton 109.27 17,215 10,196 1,095 11% 10,809 1,176 11% 1.69x 15.72x 1.59x 14.64x
CACI 313.93 9,069 6,872 743 11% 7,390 807 11% 1.32x 12.20x 1.23x 11.24x
SAIC 105.54 7,620 7,234 676 9% 7,233 687 9% 1.05x 11.27x 1.05x 11.09x
Parsons 54.35 6,530 5,015 433 9% 5,256 464 9% 1.30x 15.07x 1.24x 14.06x
V2X 51.66 2,777 3,900 303 8% 4,066 332 8% 0.71x 9.15x 0.68x 8.35x
Average $121.15 $10,173 $8,056 $801 10% $8,424 $853 10% 1.21x 12.48x 1.15x 11.70x
Sources: S&P Capital IQ

$USD, Millions besides Stock Price
The McLean Group

Q3 M&A REPORT PUBLICLY TRADED COMPANIES CONTD. Q3 2023
DEFENSE GOVERNMENT & INTELLIGENCE

Defense Systems
Teledyne Technologies 408.58 22,227 5,730 1,382 24% 6,018 1,485 25% 3.88x 16.08x 3.69x 14.96x
HEICO Corporation 161.93 20,556 3,206 788 25% 3,853 966 25% 6.41x 26.09x 5.34x 21.29x
Elbit Systems 198.76 10,205 5,793 583 10% 6,078 624 10% 1.76x 17.50x 1.68x 16.35x
Mercury Systems 37.09 2,717 966 131 14% 1,002 190 19% 2.81x 20.81x 2.71x 14.30x
Kratos Defense & Security 15.02 2,229 1,002 88 9% 1,099 107 10% 2.22x 25.32x 2.03x 20.90x
Average $164.28 $11,587 $3,339 $594 16% $3,610 $674 18% 3.42x 21.16x 3.09x 17.56x
Low $12.18 $2,229 $966 $88 8% $1,002 $107 8% 0.71x 9.15x 0.68x 8.35x
Mean $169.22 $35,759 $19,715 $2,867 13% $20,921 $3,111 14% 2.08x 14.94x 1.92x 13.24x
Median $109.27 $17,827 $7,234 $1,095 13% $7,390 $1,176 13% 1.75x 13.24x 1.68x 11.69x
High $440.19 $137,645 $72,804 $12,934 25% $78,984 $14,155 25% 6.41x 26.09x 5.34x 21.29x

The McLean Group

Q3 M&A REPORT RECENT M&A ACTIVITY Q3 2023
Closed EV EV /
Acquirer(s) Target(s) Target Description
Date ($M) Rev. EBITDA
Provides aviation O&M, aircraft
07/03/2023 Akima Pinnacle Solutions modernization, and engineering services NA NA NA
Provides advanced tech in data analytics,

07/13/2023 The Swift Group OPS Consulting NA NA NA
computing, and threat mitigation services
Provides visual intelligence, cybersecurity,
07/26/2023 NewSpring Bridge Core NA NA NA
and other solutions to the IC
Manufacturers propulsion and power
07/28/2023 L3Harris Aerojet Rocketdyne systems for rockets, and other space vehicles $4,784 2.20x 15.90x
Provides software and technology-enabled

08/02/2023 Arlington Capital Partners Integrated Data Services support and development NA NA NA
Provides a range of products and services,

08/04/2023 HEICO Wencor Group $2,050 NA NA
including aircraft replacement parts
Provides digital transformation, system
08/15/2023 Aretum Artemis modernization and agile capabilities NA NA NA
Delivers comprehensive emergency and

08/22/2023 Michael Baker International Tidal Basin disaster management consulting services NA NA NA
Focuses on protecting and defending

08/23/2023 Parsons Sealing Technologies $200 NA NA
customer’s networks and systems
Provides cloud, enterprise architecture,
08/29/2023 GCOM Software OnCore Consulting NA NA NA
project management and other IT services
Provides tailored system engineering and
09/06/2023 SPA PRKK NA NA NA
intelligence analysis to its customers
Assists customers in aerospace and defense
09/07/2023 Anduril Blue Force Technologies design through rapid-development efforts NA NA NA
Provides digital transformation consulting

09/12/2023 Mantech Definitive Logic and technology solutions NA NA NA
1 Delivers modernization and digital

09/19/2023 A&M Capital Partners VTG NA NA NA
transformation solutions to the DoD & IC
Source(s): S&P CapIQ

1. VTG received majority investment
The McLean Group

Q3 M&A REPORT PHYSICAL & CYBER SECURITY Q3 2023
─ The United States government released an unclassified summary TRANSACTIONS BY MONTH

of its classified 2023 Cyber Strategy in September. The strategy Q4 2022 Q1 2023 Q2 2023 Q3 2023
33 20 28 30
emphasizes the “need to work closely with our allies, partners,
14 14
and industry to make sure we have the right cyber capabilities,
cyber security, and cyber resilience to help deter conflict, and to 11 11
10
9 9 9
fight and win if deterrence fails.” The latest iteration is distinct 8
7
from prior versions in that it prioritizes the integration of cyber
5
capabilities into traditional warfighting capabilities. 4
─ Private space companies recently received a warning from various

DoD and intelligence agencies about potential cyberattacks by
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foreign adversaries. The warning highlights that these adversaries
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may aim to impair the satellite capabilities of the United States
during conflicts and emergencies. These opponents “see U.S. EBITDA VALUATION MULTIPLES1
space-related innovation and assets as potential threats as well as
valuable opportunities to acquire vital technologies and 22.6x 22.3x
expertise,” according to the report. 18.9x

17.9x
16.7x
Select Q3 Transactions 14.6x
7.0x
a portfolio
5.7x 5.3x
company of
acquired by acquired by acquired by
acquired by
Security Services Security Solutions Cyber / Technology
Security
LTM 2023E 2024P
Sources: Strategic Market Research, S&P Capital

IQ, CyberSecurity Dive, Gartner, NBC News
The McLean Group
PHYSICAL & CYBER SECURITY

Security Services
Securitas 7.95 8,725 14,467 1,233 9% 15,007 1,314 9% 0.60x 7.08x 0.58x 6.64x
The Brink's Company 72.64 6,323 4,886 893 18% 5,115 971 19% 1.29x 7.08x 1.24x 6.51x
Prosegur 1.62 2,493 4,681 547 12% 4,877 601 12% 0.53x 4.55x 0.51x 4.15x
Loomis 27.03 2,102 2,605 520 20% 2,727 545 20% 0.81x 4.04x 0.77x 3.86x
Average $27.31 $4,911 $6,660 $798 15% $6,931 $858 15% 0.81x 5.69x 0.77x 5.29x
Security Solutions
Honeywell International 184.74 136,857 36,965 9,486 26% 38,963 10,177 26% 3.70x 14.43x 3.51x 13.45x
Johnson Controls 53.21 47,478 27,334 4,176 15% 28,639 4,377 15% 1.74x 11.37x 1.66x 10.85x
Motorola Solutions 272.24 51,293 9,901 2,984 30% 10,403 3,193 31% 5.18x 17.19x 4.93x 16.06x
ADT 6.00 15,047 6,409 2,528 39% 6,769 2,615 39% 2.35x 5.95x 2.22x 5.75x
Allegion 104.20 11,033 3,648 859 24% 3,783 907 24% 3.02x 12.85x 2.92x 12.16x
Alarm.com Holdings 61.14 2,982 879 130 15% 927 145 16% 3.39x 22.94x 3.22x 20.59x
Napco Security Technologies 22.25 757 173 47 27% 193 53 28% 4.37x 16.03x 3.92x 14.22x
Arlo Technologies 10.30 866 486 26 5% 530 37 7% 1.78x 32.80x 1.63x 23.35x
Average $89.26 $33,289 $10,724 $2,529 23% $11,276 $2,688 23% 3.19x 16.69x 3.00x 14.55x

The McLean Group

PHYSICAL & CYBER SECURITY

Cyber Security
Fortinet 58.68 43,834 5,405 1,533 28% 6,374 1,846 29% 8.11x 28.60x 6.88x 23.75x
SolarWinds 9.44 2,648 744 310 42% 781 331 42% 3.56x 8.54x 3.39x 7.99x
Varonis Systems 30.54 2,908 501 32 6% 549 45 8% 5.81x NA 5.30x NA
Tenable 44.80 4,955 789 110 14% 910 136 15% 6.28x 45.18x 5.44x 36.51x
NetScout Systems 28.02 1,789 904 221 24% 924 240 26% 1.98x 8.10x 1.94x 7.46x
SecureWorks 6.21 480 362 (34) (9%) 358 13 4% 1.33x NA 1.34x 35.82x
Average $29.62 $9,436 $1,451 $362 18% $1,649 $435 21% 4.51x 22.61x 4.05x 22.30x
Low $1.62 $480 $173 -$34 (9%) $193 $13 4% 0.53x 4.04x 0.51x 3.86x
Mean $55.61 $19,032 $6,730 $1,422 19% $7,102 $1,530 21% 3.10x 15.42x 2.86x 14.65x
Median $29.28 $3,968 $3,126 $534 19% $3,255 $573 19% 2.69x 12.11x 2.57x 12.16x
High $272.24 $136,857 $36,965 $9,486 42% $38,963 $10,177 42% 8.11x 45.18x 6.88x 36.51x

The McLean Group

Closed EV EV /
Operates as an electronic security integration
7/12/2023 NextGen Security ISO Network NA NA NA
company that provides technology solutions
Designs and develops data security solutions. It
7/14/2023 Cisco Systems Armorblox NA NA NA
offers NLU platform for cybersecurity
SB Cyber offers AI cyber risk management and
7/19/2023 CISO Global SB Cyber Technologies NA NA NA
commercial technical security services
Provides software solutions that support the
7/27/2023 Crosspoint Capital Partners Absolute Software $867.6 3.91x 84.81x
management and security of computing devices
Provides commercial security services, serves
8/3/2023 Pavion RFI Electronics NA NA NA
corporate facilities, data centers, gov agencies
Provides a complete suite of hardware, software,
8/14/2023 Bentley Systems Blyncsy NA NA NA
and application solutions for traffic management
Assets of Accel Protection and Technologies
8/15/2023 American Int. Contractors Accel Protection and Technologies NA NA NA
comprised of security and life-safety services
Designs, develops, manufactures, and distributes
8/18/2023 IDIS Costar Technologies NA NA NA
security solution products in the United States
Offers credit monitoring, online accounts
8/24/2023 Malwarebytes Inc. Cyrus NA NA NA
protection, and cyber expert support
Develops software for application security testing.
9/5/2023 Battery Ventures CodeSecure NA NA NA
Products include CodeSonar and CodeSentry
Designs and offers advanced software, data, and
9/5/2023 First Advantage Infinite ID $41.00 NA NA
integration solutions
Offers security systems, IT solutions, and
9/14/2023 Pye-Barker Fire & Safety Alarm Monitoring Services NA NA NA
audio/video solutions
Provides network-centric dark threat detection
9/20/2023 WatchGuard Technologies CyGlass NA NA NA
solutions
Installation and support services for electronic
9/21/2023 Per Mar Security & Research Nightwatch Security Services NA NA NA
security systems for homes and businesses
Discovers and identifies assets and unifies
9/25/2023 StrataScale Vector0 NA NA NA
vulnerability and security
The McLean Group Source(s): S&P CapIQ

Q3 M&A REPORT CRITICAL INFRASTRUCTURE Q3 2023
─ Since the signing of the Bipartisan Infrastructure Law, $50 billion TRANSACTIONS BY MONTH
has been allocated to improving water and wastewater Q4 2022 Q1 2023 Q2 2023 Q3 2023
75 53 62 43
transportation and treatment facilities. Additional funding has
come just in time for water treatment facilities whose byproducts 31
27
are being increasingly turned away by landfills due to capacity
23
restraints and environmental concerns. Facilities forced to further 21 20 20 19
16 17
treat their byproducts are receiving funding from the 13
15
Infrastructure Law, with multiple projects already breaking 11
ground.
─ The month of August witnessed approximately 4.1M labor hours

lost, the largest for a single month since August 2000. Lost hours
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largely resulted from strikes by the Writers/Screen Actors Guild
M
M
and the United Auto Workers. Auto production accounts for EBITDA VALUATION MULTIPLES
almost 3% of annual GDP, with strikes posing a large threat to
18.9x
economic growth at a time when economists are already flagging
recession concerns. 16.2x 16.6x 15.9x
14.7x 14.4x 14.5x 14.5x 15.0x
Select Q3 Transactions 13.3x
12.3x
11.2x
Hemodialysis
Business
acquired by acquired by acquired by acquired by
Water Utilities System Solutions Components Infrastructure
LTM 2023E 2024P
Source(s): Whitehouse.gov, Wall Street Journal

The McLean Group

CRITICAL INFRASTRUCTURE
Water Utilities
American Water Works 123.83 35,506 4,166 2,220 53% 4,460 2,444 55% 8.52x 15.99x 7.96x 14.53x
Essential Utilities 34.33 16,000 2,355 1,117 47% 2,463 1,269 52% 6.79x 14.33x 6.50x 12.61x
California Water Service 47.31 3,863 858 285 33% 921 315 34% 4.50x 13.56x 4.20x 12.25x
American States Water 78.68 3,737 562 208 37% 558 220 39% 6.65x 17.97x 6.70x 17.01x
SJW 60.11 3,531 646 253 39% 668 273 41% 5.47x 13.95x 5.29x 12.94x
Consolidated Water 28.44 407 142 33 23% 128 25 19% 2.86x 12.26x 3.18x 16.62x
Global Water Resources 9.75 349 51 24 46% 53 24 45% 6.81x 14.87x 6.64x 14.62x
Average $54.64 9,056 1,254 591 40% 1,322 653 41% 5.94x 14.70x 5.78x 14.37x
System Solutions
Danaher 248.10 195,593 28,639 8,932 31% 30,343 9,868 33% 6.83x 21.90x 6.45x 19.82x
Dover 139.51 22,651 8,728 1,860 21% 9,108 1,990 22% 2.60x 12.18x 2.49x 11.38x
Xylem 91.03 23,830 7,211 1,314 18% 8,326 1,595 19% 3.30x 18.14x 2.86x 14.94x
IDEX 208.02 16,846 3,289 891 27% 3,429 962 28% 5.12x 18.91x 4.91x 17.52x
Pentair 64.75 12,764 4,103 914 22% 4,301 998 23% 3.11x 13.96x 2.97x 12.80x
A. O. Smith 66.13 9,783 3,788 800 21% 3,932 841 21% 2.58x 12.22x 2.49x 11.63x
Watts Water Technologies 172.82 5,564 2,018 393 19% 2,122 412 19% 2.76x 14.15x 2.62x 13.50x
Average $141.48 41,004 8,254 2,158 23% 8,795 2,381 24% 3.76x 15.92x 3.54x 14.51x

The McLean Group

CRITICAL INFRASTRUCTURE
Components
Graco 72.88 11,949 2,220 714 32% 2,309 758 33% 5.38x 16.74x 5.17x 15.75x
Flowserve 39.77 6,313 4,250 496 12% 4,500 563 13% 1.49x 12.74x 1.40x 11.21x
Franklin Electric 89.23 4,370 2,163 331 15% 2,244 344 15% 2.02x 13.22x 1.95x 12.69x
Mueller Water Products 12.68 2,317 1,207 177 15% 1,222 216 18% 1.92x 13.06x 1.90x 10.74x
The Gorman-Rupp 32.90 1,279 651 113 17% 684 118 17% 1.96x 11.27x 1.87x 10.82x
Energy Recovery 21.21 1,113 133 24 18% 171 38 22% 8.39x 46.56x 6.49x 29.07x
Average $44.78 4,557 1,770 309 18% 1,855 340 20% 3.53x 18.93x 3.13x 15.05x
Infrastructure
AECOM 83.04 13,349 14,498 989 7% 15,266 1,073 7% 0.92x 13.49x 0.87x 12.44x
Tetra Tech 152.03 9,071 3,911 491 13% 4,199 544 13% 2.32x 18.49x 2.16x 16.68x
Clean Harbors 167.36 11,320 5,467 1,041 19% 5,714 1,115 20% 2.07x 10.88x 1.98x 10.15x
EMCOR Group 210.39 9,983 12,366 850 7% 13,310 926 7% 0.81x 11.74x 0.75x 10.79x
Arcosa 71.90 3,893 2,273 364 16% 2,466 396 16% 1.71x 10.69x 1.58x 9.83x
Primoris Services 32.73 2,984 5,567 363 7% 6,046 406 7% 0.54x 8.21x 0.49x 7.36x
Average $119.58 8,433 7,347 683 11% 7,833 743 12% 1.39x 12.25x 1.31x 11.21x
Low $9.75 $349 $51 $24 7% $53 $24 7% 0.54x 8.21x 0.49x 7.36x
Mean $90.73 $16,476 $4,664 $969 24% $4,959 $1,067 25% 3.75x 15.44x 3.53x 13.84x
Median $72.39 $7,692 $2,822 $493 20% $2,948 $554 20% 2.81x 13.75x 2.74x 12.74x
High $248.10 $195,593 $28,639 $8,932 53% $30,343 $9,868 55% 8.52x 46.56x 7.96x 29.07x
The McLean Group

Closed EV EV /
Manufactures chemicals for hemodialysis
7/10/2023 Rockwell Medical Hemodialysis Business of Evoqua $16.0 NA NA
concentrates
Provide natural gas derived energy in Texas'
7/11/2023 BKV-BPP Power Gas-fired power plant in Texas $460.0 NA NA
I-35 corridor
7/13/2023* Exxon Mobil Denbury Oil and gas exploration and holding company $4,955.5 3.33x 6.30x
Provides logistics, airfield operations, and

8/7/2023 Versar Louis Berger Services NA NA NA
technical staffing services
Investment Management
8/9/2023* NextWind Capital Acquires and repowers onshore wind farms $750.0 NA NA
Corporation of Ontario et al
Engages in the acquisition and development
8/14/2023* Permian Resources Corporation Earthstone Energy $4,412.3 2.44x 3.53x
of oil and gas reserves
8/25/2023* Asterion Industrial Partners STEAG Operates power facilities $2,801.1 NA NA
Provides water, wastewater, and energy

8/29/2023 SouthWest Water Company Corix Infrastructure NA NA NA
utility infrastructure for communities
Pipestone Natural Gas Processing Natural gas processing and storage facility in
8/31/2023* AltaGas $483.1 NA NA
and Storage Facility Canada
Operates in the energy midstream sector in
8/31/2023* Energy Transfer Crestwood Equity Partners $7,275.1 1.38x 8.10x
the United States
Provides commercial services for water
9/6/2023 A. O. Smith Water Tec of Tucson NA NA NA
treatment equipment
Operates renewable energy and energy
9/7/2023* Repsol ConnectGen $768.0 NA NA
storage projects across North America
Engages in the transportation, storage, and

9/25/2023 ONEOK Magellan Midstream Partners $18,938.4 5.58x 12.28x
distribution of refined petroleum products
Sources: S&P Capital IQ, DACIS, press releases

* Announcement date
The McLean Group

Q3 M&A REPORT MARITIME TRANSPORT & FACILITIES Q3 2023
─ As part of the Biden Administration’s goal of deploying 30 GW of TRANSACTIONS BY MONTH

offshore wind capacity, the Bureau of Ocean Energy Q2 2023 Q3 2023
Q4 2022 Q1 2023
Management announced three final Wind Energy Areas (WEAs) 30 33 19 23
off the coast of Delaware, Maryland, and Virginia that could 15

support 4-8 GW of energy production.
11
─ During July, Russia failed to renew the Black Sea Grain Deal, 10 10
9
8 8 8
which allowed for the safe passage of ships exporting grain from 7 7 7
ports under Russian blockades. So far, the deal has allowed for 5
the export of 33 million tons of grain from Ukraine, which

accounted for 10% of global wheat exports before the war. The
expiration of the agreements was immediately followed by
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Russian strikes on key port infrastructure on Ukraine’s Danube
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River. EBITDA VALUATION MULTIPLES1
─ Since the start of June, the West Texas Intermediate oil

benchmark has risen about 30%, largely due to OPEC production 12.6x
cuts. As a significant input expense, higher fuel costs are 10.6x

expected to weigh on profits for the shipping industry.
7x 7.3x
Select Q3 Transactions 6.4x 6.5x 6.3x
4.9x 4.7x 4.8x
4.1x 4.4x
acquired by acquired by* acquired by acquired by*

Diversified Maritime Shipyard and Port Bulk S hipping Petroleum Shipping
Logistics Services & Transportation
LTM 2023E 2024P

Sources: Whitehouse.gov, CNN, New York Times
* Announced, not closed
The McLean Group
MARITIME TRANSPORT & FACILITIES

Diversified Maritime Logistics

Algoma Central Corporation 10.88 673 534 147 28% 575 164 29% 1.26x 4.58x 1.17x 4.10x
Matson 88.72 3,799 2,999 449 15% 3,053 459 15% 1.27x 8.46x 1.24x 8.27x
Kirby Corporation 82.80 6,066 3,110 555 18% 3,289 652 20% 1.95x 10.93x 1.84x 9.31x
ArcBest Corporation 101.65 2,540 4,443 333 7% 4,791 454 9% 0.57x 7.63x 0.53x 5.59x
Diana Shipping 3.47 713 261 139 53% 253 144 57% 2.74x 5.13x 2.82x 4.94x
Average $57.50 2,758 2,269 325 24% 2,392 375 26% 1.56x 7.34x 1.52x 6.44x
Shipyard & Port Services

International Container 3.66 10,868 2,284 1,429 63% 2,375 1,499 63% 4.76x 7.61x 4.58x 7.25x
Great Lakes Dredge & Dock 7.97 945 619 59 10% 791 122 15% 1.53x 15.98x 1.20x 7.75x
Tidewater 71.07 3,753 1,013 393 39% 1,353 647 48% 3.71x 9.55x 2.77x 5.80x
Orion Group 5.36 267 731 20 3% 780 46 6% 0.37x 13.64x 0.34x 5.82x
DEME Group 110.08 3,576 3,119 559 18% 3,380 624 18% 1.15x 6.40x 1.06x 5.73x
Average $39.63 3,882 1,553 492 26% 1,736 588 30% 2.30x 10.63x 1.99x 6.47x
Dry Bulk Shipping

Costamare 9.62 3,050 1,140 593 52% 1,138 662 58% 2.68x 5.14x 2.68x 4.61x
Star Bulk Carriers 19.28 2,879 675 375 55% 772 447 58% 4.26x 7.68x 3.73x 6.44x
Golden Ocean Group Limited 7.88 2,937 602 292 48% 706 410 58% 4.88x 10.07x 4.16x 7.16x
Danaos Corporation 66.22 1,357 964 744 77% 962 741 77% 1.41x 1.82x 1.41x 1.83x
Global Ship Lease 18.34 1,431 653 447 68% 663 454 69% 2.19x 3.20x 2.16x 3.15x
The McLean Group

MARITIME TRANSPORT & FACILITIES

Dry Bulk Shipping

Safe Bulkers 3.24 728 277 142 51% 340 169 50% 2.63x 5.13x 2.14x 4.30x
Eagle Bulk Shipping 42.03 818 293 82 28% 309 155 50% 2.79x 10.00x 2.64x 5.26x
Genco Shipping & Trading 13.99 698 239 96 40% 289 137 48% 2.91x 7.30x 2.41x 5.08x
Average $22.58 1,737 605 346 53% 647 397 58% 2.97x 6.29x 2.67x 4.73x
Petroleum Products Transportation

Scorpio Tankers 54.12 4,170 1,308 899 69% 1,195 767 64% 3.19x 4.64x 3.49x 5.43x
International Seaways 45.00 2,942 1,050 712 68% 921 601 65% 2.80x 4.13x 3.20x 4.89x
Teekay Tankers 41.63 1,537 905 625 69% 755 453 60% 1.70x 2.46x 2.04x 3.40x
DHT Holdings 10.30 1,935 401 316 79% 474 375 79% 4.83x 6.13x 4.08x 5.16x
Nordic American Tankers 4.12 1,043 282 202 72% 289 207 72% 3.69x 5.16x 3.61x 5.03x
Ardmore Shipping 13.01 654 259 158 61% 231 140 61% 2.53x 4.14x 2.84x 4.69x
Average $28.03 2,047 701 485 70% 644 424 67% 3.12x 4.44x 3.21x 4.77x
Low $3.24 $267 $239 $20 3% $231 $46 6% 0.37x 1.82x 0.34x 1.83x
Mean $34.77 $2,474 $1,173 $407 45% $1,237 $439 48% 2.57x 6.95x 2.42x 5.46x
Median $16.17 $1,736 $703 $354 52% $776 $450 58% 2.65x 6.27x 2.53x 5.21x
High $110.08 $10,868 $4,443 $1,429 79% $4,791 $1,499 79% 4.88x 15.98x 4.58x 9.31x

The McLean Group

Closed EV EV /
Provides freight management services in the
7/7/2023 AS BaltCap; Cogel Investments Xpediator $198.5 0.44x 6.92x
U.K. and Europe
7/28/2023 Allcargo Belgium Nordicon Offers freight and rail transportation services $82.3 NA NA
Operates a container terminal in the

8/11/2023 Evergreen Marine Euromax Terminal Rotterdam $397.3 NA NA
Netherlands
Provider of integrated logistics and container
8/15/2023 QTerminals Kramer Botlek Holding NA NA NA
services located in the Port of Rotterdam
Operates as a stevedore and terminal
9/12/2023 Carrix Ceres Terminals NA NA NA
operator in North America
Provides integrated service to the
9/14/2023 Goldman Sachs Asset Mgmt. Frøy $2,004.3 4.97x 16.37x
aquaculture industry in Norway
Provides shipping and energy supply chain
9/15/2023 Saverex Exmar $511.3 1.71x 6.46x
solutions worldwide
Offers chartering services for U.S. flag
9/20/2023 Maritime Partners U.S. Marine Management NA NA NA
tankers and military support vessels
A procurement platform for marine, oil, and
8/29/2023* The Marcura Group ShipServ NA NA NA
gas industries worldwide
Marine transportation services for the
9/12/2023* MOL Chemical Tankers Fairfield Chemical Carriers $400.0 NA NA
chemical industry
Terminal operator at the port of Hamburg,
9/13/2023* MSC Mediterranean Shipping Hamburger Hafen und Logistik $1,825.9 NA NA
Germany
Shipping and logistics company focused on
9/13/2023* N Shipmanagement Acquisition Navios Maritime Holdings NA NA NA
the shipment of dry bulk commodities
Provides marine geophysical mapping
9/18/2023* TGS PGS $1,578.1 2.21x 4.83x
services
Sources: S&P Capital IQ, DACIS,

press releases
The McLean Group

Q3 M&A REPORT INDEX COMPOSITION OCTOBER 2023
Defense, Government & Intelligence Physical & Cyber Security Critical Infrastructure Maritime Transport & Facilities
Defense Primes Security Services Water Utilities Diversified Maritime Logistics
Raytheon RTX Securitas AB SECU B American Water Works AWK Algoma Central ALC
Lockheed Martin LMT The Brink’s Company BCO Essential Utilities WTRG Matson MATX
Northrop Grumman NOC Prosegur PSG California Water Service CWT Kirby KEX
General Dynamics GD Loomis AB LOOMIS American States Water AWR ArcBest ARCB
L3Harris Technologies LHX Security Solutions SJW Group SJW Diana Shipping DSX
BAE BA. Honeywell International HON Consolidated Water CWCO Shipyard & Port Services
Government Contractors Johnson Controls International JCI Global Water Resources GWRS International Container Serv. ICT
Leidos LDOS Motorola Solutions MSI System Solutions Great Lakes Dredge & Dock GLDD
Booz Allen Hamilton BAH ADT ADT Danaher DHR Tidewater TDW
CACI International CACI Allegion ALLE Dover DOV Orion Group ORN
SAIC SAIC Alarm.com Holdings ALRM Xylem XYL DEME Group NV DEME
Parsons PSN Napco Security Technologies NSSC IDEX IEX Dry Bulk Shipping
V2X VVX Arlo Technologies ARLO Pentair PNR Costamare CMRE
Defense Systems Cyber Security A. O. Smith AOS Star Bulk Carriers SBLK
HEICO HEI Fortinet FTNT Watts Water Technologies WTS Golden Ocean Group GOGL
Teledyne Technologies TDY SolarWinds SWI Components Danaos DAC
Elbit Systems ESLT Varonis Systems VRNS Graco GGG Global Ship Lease GSL
Mercury Systems MRCY Tenable Holdings TENB Flowserve FLS Safe Bulkers SB
Kratos Defense & Security KTOS NetScout System NTCT Franklin Electric FELE Eagle Bulk Shipping EGLE
SecureWorks SCWX Badger Meter BMI Genco Shipping & Trading GNK
SPX FLOW FLOW Petroleum Products Transportation
Mueller Water Products MWA Scorpio Tankers STNG
The Gorman-Rupp GRC International Seaways INSW
Energy Recovery ERII Teekay Tankers TNK
Infrastructure DHT Holdings DHT
AECOM ACM Nordic American Tankers NAT
Tetra Tech TTEK Ardmore Shipping ASC
Clean Harbors CLH
EMCOR Group EME
Arcosa ACA
Primoris Services PRIM
The McLean Group

1660 International Dr.
Q3 M&A REPORT Suite 810 (703) 827-0200 Q3 2023
www.mcleanllc.com
McLean, VA 22102
Mergers & Acquisitions Business Valuation DLS Marine
Mark Bertler Marc Gruzenski Ryan Berry Tyler Halstead Norman Dufour
Chicago, IL Los Angeles, CA McLean, VA McLean, VA New Orleans, LA
Water & Wastewater Security & Technology Valuation Advisory Valuation Advisory DLS Marine
(847) 226-0793 (703) 827-0246 (703) 827-0091 (703) 752-9013 (504) 835-8505
[email protected] [email protected] [email protected] [email protected] [email protected]
Paul Klick Mitch Martin Michael Loftus Shari Overstreet Harry Ward
McLean, VA McLean, VA McLean, VA Austin, TX New Orleans, LA
Technology Defense & Gov’t Services Valuation Advisory Valuation Advisory DLS Marine
(703) 752-9019 (703) 752-9009 (703) 827-0200 (512) 687-3485 (504) 835-8505
[email protected] [email protected] [email protected] [email protected] [email protected]
Andy Smith Scott Sievers

McLean, VA McLean, VA
Defense & Gov’t Services Valuation Advisory
(703) 827-0233 (703) 827-8685
[email protected] [email protected]
Securities Disclaimer
The information provided in this newsletter is for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy
any of the securities mentioned herein. Past performance does not guarantee future results. None of the information or analyses presented are intended
to form the basis for any investment decision, and no specific recommendations are intended. Any performance mentioned does not include transaction
fees and costs, which would reduce an investor's return. An investment cannot be made directly in these custom market indices.
The logos and company names used in this report are for illustration purposes only, and the report is not associated with or supported by the owners of
the trademarks.
© 2023 The McLean Group. All rights reserved. Securities transactions are conducted through McLean Securities, LLC, a member of FINRA/SIPC.
The McLean Group


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Q3 2023 Acquisitions

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What services does The McLean Group provide?

What services does The McLean Group provide?

What industries have seen elevated M&A activity?

What industries have seen elevated M&A activity?

Q3 M&A REPORT Q3 2023

M&A Insider Report

FIRM OVERVIEW INDUSTRY FOCUSED M&A

• Founded in 1997 and Government Services Physical & Cyber Security

• Team includes career

CORE BUSINESS 360 FINANCIAL COVERAGE

Investment Banking • Sell-Side M&A 140+ > 400

Business Valuation • “Fair Value” Financial Reporting

>90% > $8B

The McLean Group

Major News Stories

IPO Market Shows Signs of Life

PE Turns to Add-on Acquisitions with Troubled Economy

Government Shutdown Temporarily Averted

The McLean Group

Institutional capital continues to flow to Private Debt

ANNUAL INSTITUTIONAL PRIVATE DEBT FUNDRAISING ACTIVITY ($B)

$202B $212B $203B

Sources: PitchBook, Bloomberg, Reuters

The McLean Group

─ On September 30th, President Joe Biden signed a temporary TRANSACTIONS BY MONTH

the legacy CIO-SP3 vehicle ends in April of 2024. 21.2x

Sources: Bloomberg, S&P Capital IQ, FedScoop,

Transaction Details Transaction Details Transaction Details2

Transaction Details Transaction Details Transaction Details2

Sources: S&P Capital IQ, DACIS, GovConWire

Firm Fixed Price / Provide rapid procurement of hardware systems,

U.S. Defense Microelectronics Provide uninterrupted access to secure

Deliver network and exploitation analysis to

National Advanced Mobility Perform coordinated R&D projects to accelerate

Perform individual and household income

Provide life cycle services for the U.S. Army

Support DHS IT O&M, security, design

Sources: DACIS, Clearance Jobs, GOVConWire,

The McLean Group

TRAILING TWELVE MONTHS (TTM) PUBLIC EQUITY INDEX CHART 1

Defense Primes Gov’t Contractors Defense Systems S&P 500

LTM REVENUE VALUATION MULTIPLES

LTM EBITDA VALUATION MULTIPLES

55.5x1 Median: 13.9x

The McLean Group

DEFENSE GOVERNMENT & INTELLIGENCE

Sources: S&P Capital IQ

The McLean Group

DEFENSE GOVERNMENT & INTELLIGENCE

Sources: S&P Capital IQ

The McLean Group

Provides advanced tech in data analytics,

Provides software and technology-enabled

Provides a range of products and services,

Delivers comprehensive emergency and

Focuses on protecting and defending

Provides digital transformation consulting

1 Delivers modernization and digital

Source(s): S&P CapIQ