Tyto Athene to Acquire AT&T’s Defense Sector-Focused IT Professional Services Business

WASHINGTON–(BUSINESS WIRE)–Tyto Athene (“Tyto”) has entered into an agreement to acquire AT&T Government Solutions, Inc. (“GSI”), which comprises AT&T’s Department of Defense IT professional services business and select other contracts. AT&T and Tyto have also agreed to enter into teaming agreements for opportunities in the DoD IT professional services market. It is expected to close at the end of the first quarter or early in the second quarter of 2021. Terms of the transaction were not disclosed.

Tyto Athene is a full-service systems integrator that provides design, installation, and support of complex voice, data, and security networks for customers in the Federal Government, Department of Defense, State and Local Governments, communities, first responders and organizations across the United States and around the globe. Tyto was created in August of 2018 when Arlington Capital Partners (“Arlington”) acquired the Government Solutions division of Black Box Corporation. In 2019, Tyto acquired Island Information Technology Consultants, Inc., a provider of unified communications solutions to the Intelligence Community.

The combination of Tyto and GSI would create a leading pure-play provider of IT professional services and solutions to critical US Government agencies with positions on best-in-class contract vehicles, a full spectrum of industry leading capabilities, and substantial scale and resources to serve the increasingly complex needs of US Government agencies. After closing, the newly expanded Tyto Athene will employ approximately 1,200 highly skilled employees with 18 offices across the US and worldwide. Tyto expects this transaction to enhance its ability to address the rapidly evolving requirements of technology-enabled digital transformation and joint all-domain operations as a critical element of the U.S. national defense strategy.

“We are thrilled to announce that we have entered into a definitive agreement to acquire AT&T GSI and look forward to joining forces with the GSI team. We believe that the cultures of Tyto and GSI are highly complementary as both are focused on delivering superior solutions to the customer and mission,” said Chris Meilhammer, President and COO of Tyto Athene. “The incremental IDIQ contract vehicles that will convey with GSI, such as Alliant 2, RS3, ITES-3S, Seaport-NxG, and MEGASTAR, will provide us new ways to contract with our customers. We will continue to be poised to benefit from the secular tailwinds of U.S. Government investment in legacy IT modernization and cybersecurity efforts. Tyto looks forward to teaming with AT&T to identify and pursue opportunities in the DoD and beyond.”

“Divesting these assets aligns with our strategy to support and serve our public sector customers with our industry leading networking solutions,” said Anne Chow, Chief Executive Officer, AT&T Business. “We remain firmly committed to enabling our clients’ success across the Public Sector, including Defense, Civilian, National Security and Public Safety agencies, and helping them modernize their infrastructure in support of their missions. We look forward to the opportunity to work with Tyto Athene to meet the needs of our Federal customers.”

Carl Tegen, an Executive of AT&T’s DoD professional services business, said, “The GSI leadership team is excited about the opportunity to combine with Tyto as it will enhance our ability to transform our clients’ missions as well as provide freedom to expand into adjacent markets. Our stakeholders can rest assured that GSI, as part of Tyto, will continue to provide our current and future government customers with the highest quality innovative services and solutions.”

Michael Lustbader, a Managing Partner at Arlington, said, “We are excited for the combination of Tyto and GSI to create a digital transformation company that has the size and breadth to meet the needs of the combined customer set. This transaction continues Arlington’s long history of partnering with large corporations to execute complicated carve-outs in an effort to build industry leading companies through strategic M&A. We look forward to supporting the growth of the combined business.”

About Tyto Athene

Tyto Athene is a full-service systems integrator providing design, installation, and support of complex voice, data, and security networks. Our wide range of network services and solutions include VoIP/voice, video, data, transport, infrastructure, network management, and security. Tyto Athene has over fifty years of experience supporting the Federal Government, the Department of Defense, State and Local Governments, communities, first responders and organizations across the United States and around the globe. Tyto Athene is focused on helping clients securely access information in order to accelerate their ability to make decisions. Its team utilizes industry-leading technologies, innovative thinking, and proven processes to deliver successful outcomes to clients. We believe our success is owed to our employees, who at every level are valued and given the resources to continuously achieve excellence. To learn more about Tyto Athene please visit www.gotyto.com.

About AT&T Communications

We help family, friends and neighbors connect in meaningful ways every day. From the first phone call 140+ years ago to mobile video streaming, we @ATT innovate to improve lives.

AT&T Communications is part of AT&T Inc. (NYSE:T). For more information, please visit us at att.com.

About AT&T Government Solutions, Inc

AT&T Government Solutions, Inc. (GSI), the Department of Defense-focused IT professional services offering within AT&T Public Sector, has a long history and rich tradition of delivering superior IT solutions and professional services across the US Defense Department and several federal civilian agencies. GSI primarily consists of highly experienced and cleared information technology engineers, consultants, and expert analysts. GSI’s solutions and services support the U.S. Army Unified Communications (UC) program, U.S. Space Force cyber defense mission, U.S. Air Force Advanced Battle Management System (ABMS), U.S. Navy 911 communications, DOD-wide 5G experimentation and testing efforts, and various other critical mission areas.

About Arlington Capital Partners

Arlington Capital Partners is a Washington, DC-based private equity firm that is currently investing out of Arlington Capital Partners V, L.P., a $1.7 billion fund. The firm has managed approximately $4.0 billion of committed capital via five investment funds. Arlington is focused on middle market investment opportunities in growth industries including aerospace & defense, government services and technology, healthcare, and business services and software. The firm’s professionals and network have a unique combination of operating and private equity experience that enable Arlington to be a value-added investor. Arlington invests in companies in partnership with high quality management teams that are motivated to establish and/or advance their Company’s position as leading competitors in their field. Visit arlingtoncap.com to learn more.

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