On Assignment Acquires Staffing Firm for $600 MillionTuesday, March 20, 2012
Temporary worker agency On Assignment will pay $600 million to acquire Apex Systems, a technology staffing firm based in Glen Allen, Va.
The announcement from Calabasas-based On Assignment said the two companies had combined revenues of $1.3 billion in 2011, and after the acquisition their combined operation will rank as the second-largest information technology staffing firm in the United States.
Peter Dameris, chief executive officer of On Assignment, said in a statement that Apex doesn’t duplicate the jobs offered by On Assignment’s current technology division.
“Because the offerings do not compete, the acquisition will create value for our clients, shareholders and employees by expanding our presence in the IT staffing market,” Demaris said in the statement. “The transaction also achieves On Assignment’s five-year strategic plan to reach $1 billion in annual revenue three years ahead of schedule.”
The purchase price will consist of $383 million in cash and newly issued stock worth $217 million. In connection with the transaction, On Assignment obtained a commitment for a new $540 million credit facility, comprised of a $490 million term loan and a $50 million credit line. The term loan will finance the cash portion of the purchase price.
The acquisition announcement was made after the stock market closed Tuesday. Shares of On Assignment ended Tuesday at $13.68, a decline of 58 cents or 4 percent for the day on the Nasdaq.