On Assignment Oxford Acquisition

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US – On Assignment Buys Apex for $600 Million

21 March 2012

On Assignment Inc. (NASD: ASGN) is buying Apex Systems Inc., one of the largest and fastest-growing suppliers of information technology staffing. Privately held Apex ranks No. 6 on Staffing Industry Analysts’ 2011 list of largest IT staffing firms. Apex has also qualified for the list of fastest-growing U.S. staffing firms every year since 2005.

On Assignment will pay $600 million to acquire all of Apex and retire its debt. The price includes $383 million in cash and newly issued stock valued at $217 million.

Apex posted revenue of $705.2 million in 2011.

On Assignment, based in Calabasas, Calif., posted revenue of $597.3 million in 2011, up 36.3 percent from the previous year. It recorded IT and engineering revenue of $266.7 million in 2011, an increase of 49.3 percent from the previous year.

On Assignment ranks No. 30 on the list of largest IT staffing firms based on 2010 revenue. It provides IT services through its Oxford Global Resources brand. On Assignment also provides healthcare, clinical and engineering staffing.

The Apex deal comes after several years of discussions, said On Assignment President and CEO Peter Dameris. Those discussions began after On Assignment did a deep strategic analysis of its own business including looking at the viability of IT staffing.

Dameris said both On Assignment and Apex share similar cultures but do not compete for the same business.

“We both have very high performance-driven cultures … they are both young vibrant organizations,” he said. However, “there’s no sales channel conflict there, people are focused on market share.”

The deal was built with the view toward strategic top-line revenue growth but zero synergy savings, Dameris said.

Richmond, Va.-based Apex will become a division of On Assignment and continue to operate as it has in the past. Set to remain with the On Assignment and have representation on its board are Apex’s three founders: Jeff Veatch, Win Sheridan and Brian Callaghan. Apex Chief Operating Officer Rand Blazer and CFO Ted Hanson will also remain in place.

Apex was founded in 1995 and has 49 locations in the U.S. Its services included contract IT professionals, temp-to-perm and direct hire as well as recruitment process outsourcing (RPO), statement of work and specialty skill sourcing.

Apex’s average bill rate is $60 per hour, and it presently has approximately 16,500 workers at 1,200 clients. Apex receives about 60 percent of its revenue through vendor management systems (VMS). Oxford Global presently has approximately 1,400 temporary workers at clients. Oxford Global does not have revenue through a VMS.

On Assignment estimated revenue for the second half of 2012 will be between $775 million and $805 million with the acquisition of Apex. It forecasts gross margin of 30 percent to 31 percent for the second half of 2012.

The deal is expected to close in May and is subject to approval by On Assignment’s shareholders.

- Focused on the High End of Information Technology and Engineering Staffing - - Conference Call Scheduled for January 4 at 10:30 A.M. ET -

CALABASAS, Calif., Jan. 3 /PRNewswire-FirstCall/ -- On Assignment, Inc. (Nasdaq: ASGN) announced today that it has signed a definitive agreement to acquire Oxford Global Resources, Inc. ("Oxford"), a leading provider of high-end information technology and engineering staffing services. The acquisition provides On Assignment with entry into the large and growing market for information technology and engineering staffing services and adds a third practice to the Company's existing Healthcare and Lab Support staffing businesses. On Assignment expects that the acquisition will increase its pro forma revenue growth rate and gross margins and will be accretive to earnings per share in 2007. Management will provide full 2007 guidance in conjunction with its fourth quarter 2006 results.

According to the terms of the agreement, On Assignment will pay $190.0 million in cash and $10.0 million in common stock for a total purchase price of $200.0 million. In addition, Oxford shareholders have the opportunity to achieve an earn-out of up to $12.0 million based on Oxford's 2007 and 2008 performance. The Company intends to utilize its existing cash position and a new $165 million senior secured credit facility it is negotiating to finance the acquisition. The new facility is expected to include a $20 million revolving credit facility, which will be undrawn at closing, and a $145 million term loan facility. The Company may achieve an annual after tax savings of approximately $5 million per year over the next 15 years as a result of the election to classify the Oxford transaction as an asset sale for tax purposes under section 338(h)(10) of the IRS code, assuming it has taxable income to offset such deductions. After the closing of the proposed transaction, On Assignment expects to have approximately $16 million cash on hand.

Oxford is expected to report 2006 revenues of approximately $177 million, up over 20% from the prior year. Gross margins over the last three years have been in excess of 34%. Revenue contributed from permanent placement services is less than 1% of Oxford's total revenues. The addition of the high margin services provided by Oxford, coupled with the recently announced acquisition of VISTA Staffing Solutions ("VISTA"), will have a positive impact on On Assignment's pro forma bill rates and gross margin. On Assignment's average annual bill rate, pro forma for the acquisitions of Oxford and VISTA, will be in excess of $90 per hour, among the highest in the staffing industry. In addition, On Assignment's gross margin for the twelve months ended September 30, 2006 would increase on a pro forma basis to approximately 30% from approximately 27%.

Oxford focuses on the high-end of the information technology and engineering staffing markets, delivering highly specialized skill sets for time-sensitive, mission-critical projects for its clients. Oxford's high-end focus is exemplified by its hourly bill rates, which are among the highest in the industry, averaging over $100 per hour and ranging up to $225+ per hour. Oxford has a network of 20 offices in the United States and one in Ireland, and a diversified client base of over 650 companies, which present strong domestic and international growth opportunities. In addition, Oxford's average length of assignment is approximately five months, and the company has minimal customer concentration with no customer accounting for more than 3% of its revenues.

Oxford has an active pool of approximately 25,000 candidates, with approximately 850 professionals on assignment as of December 31, 2006. Michael McGowan, President of Oxford Global Resources, has been with the company for nearly ten years and will continue to lead Oxford.

Peter Dameris, President and Chief Executive Officer of On Assignment, said, "Oxford is a well-established, leading player in the large and growing information technology and engineering staffing sectors. Oxford employs a disciplined strategy of focusing on temporary staffing assignments that require high-end skill sets. The acquisition is a significant fit with On Assignment's growth strategy of operating in strong niche staffing practices with durable business models that are characterized by high bill rates, high and sustainable gross margins and low customer concentration. As with our recent VISTA acquisition, Oxford adds a growth segment of the professional staffing business that generates higher than industry average bill rates and gross margins with a large, attractive and diverse client base. On Assignment expects, with the acquisitions of Oxford and VISTA, to have pro forma revenues in excess of $520 million for 2006.

Mr. Dameris continued, "When we were on the roadshow for our recent follow-on offering in November, we discussed a growth strategy that involved vigorously pursuing growth opportunities in our core Healthcare and Lab Support staffing businesses, and augmenting this growth with acquisitions in other complementary, high-end professional staffing verticals. I feel we have been very successful in growing our core businesses, having grown consolidated revenues 22% in the first three quarters of 2006. Pro forma for the Oxford and VISTA acquisitions, our Healthcare (including VISTA) and Lab Support practices will represent roughly two-thirds of our overall revenues and continue to present us with exciting growth opportunities in those areas going forward. The acquisition of Oxford will augment the growth we are experiencing in our core staffing businesses by providing us with access to the robust IT staffing market, which represents approximately $17 billion-plus of annual spend, and the $6 billion-plus technical/engineering market, both with double digit annual growth. I believe the collective experience of our management team, in the IT area and in acquisitions, will be invaluable in building shareholder value from this transaction. Having successfully deployed the capital we raised in November, we will now focus the majority of our resources on operating our existing business and supporting the two businesses we have agreed to acquire."

Michael McGowan, President of Oxford Global Resources, said, "We are pleased to join forces with On Assignment. We believe On Assignment, with its similar business model and culture to Oxford, will provide the right platform to bring Oxford to its next level of growth. Throughout our history, we have remained focused and passionate about providing the right professionals for time-sensitive, mission-critical projects for our clients. As a part of the On Assignment organization, we will continue to uphold this standard, which has been a hallmark of our services to our clients and contract professionals since our founding more than 20 years ago."

UBS Investment Bank is acting as On Assignment's financial advisor and arranging the financing in this transaction.

On Assignment and Oxford Global Resources will hold a conference call to discuss the acquisition tomorrow, Thursday, January 4, 2007 at 10:30 A.M. ET. Interested parties are invited to listen to the conference call by dialing 877-407-4018 for domestic callers or 201-689-8471 for international callers ten minutes before the call. A replay of the conference call can be accessed from approximately 1:00 P.M. ET on Thursday, January 4, 2007 through January 18, 2007 by dialing 877-660-6853 for domestic callers or 201-612-7415 for international callers with the account number 3055 and conference ID# 226437.

This call is being webcast by Thomson/CCBN and can be accessed, along with the slide presentation, at On Assignment's web site at www.onassignment.com. Individual investors can also listen at Thomson/CCBN's site at www.fulldisclosure.com or by visiting any of the investor sites in Thomson/CCBN's Individual Investor Network. Institutional investors can access the call via Thomson/CCBN's password-protected event management site, StreetEvents at www.streetevents.com.

About On Assignment

On Assignment, Inc. is a diversified professional staffing firm providing flexible and permanent staffing solutions in specialty skills including Laboratory/Scientific, Healthcare, and Medical, Financial & Health Information Services. The corporate headquarters are located in Calabasas, California. On Assignment, Inc. was founded in 1985 as On Assignment/Lab Support and went public in 1992. The company's branch network encompasses approximately 60 branch offices across the United States, the United Kingdom, the Netherlands, and Belgium. On Assignment, Inc.'s common stock is traded on the Nasdaq Stock Market under the symbol ASGN.

About Oxford Global Resources

Oxford Global Resources (www.oxfordcorp.com) is a leading provider of high-end information technology and engineering staffing services. Founded in 1984, Oxford delivers senior information technology, software and hardware engineering, mechanical, electrical and validation engineering and telecommunications engineering professionals to clients in a wide range of industries. Headquartered in Beverly, Massachusetts, Oxford has 20 offices throughout the United States and an office in Ireland to serve the European market.

Safe Harbor

Certain statements made in this news release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and involve a high degree of risk and uncertainty. All statements in this release, other than those setting forth strictly historical information, are forward looking statements. Forward-looking statements are not guarantees of future performance, and actual results might differ materially. Factors that could cause or contribute to such differences include actual demand for our services, our ability to attract, train and retain qualified staffing consultants, our ability to remain competitive in obtaining and retaining temporary staffing clients, the availability of qualified temporary nurses and other qualified temporary professionals, management of our growth, continued performance of our enterprise-wide information systems, our ability to successfully make or integrate new acquisitions and other risks detailed from time to time in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2005, as filed with the SEC on March 16, 2006. We specifically disclaim any intention or duty to update any forward-looking statements contained in this news release.

Contact: Investors/Media: On Assignment, Inc. The Ruth Group James Brill Carol Ruth/Jason Rando Sr. VP and Chief Financial Officer (646) 536-7004/7025 (818) 878-7900 cruth@theruthgroup.com jim.brill@onassignment.com jrando@theruthgroup.com (Logo: http://www.newscom.com/cgi-bin/prnh/20041022/LAF035LOGO ) SOURCE On Assignment, Inc. -0- 01/03/2007 /CONTACT: James Brill, Sr. VP and Chief Financial Officer of On Assignment, Inc., +1-818-878-7900, jim.brill@onassignment.com; or Investors/Media, Carol Ruth, +1-646-536-7004, cruth@theruthgroup.com, or Jason Rando, +1-646-536-7025, jrando@theruthgroup.com, both of The Ruth Group, for On Assignment, Inc./ /Photo: http://www.newscom.com/cgi-bin/prnh/20041022/LAF035LOGO AP Archive: http://photoarchive.ap.org PRN Photo Desk, photodesk@prnewswire.com/ /Web site: http://www.streetevents.com / /Web site: http://www.oxfordcorp.com / /Web site: http://www.onassignment.com / (ASGN) CO: On Assignment, Inc.; Oxford Global Resources ST: California IN: CPR MLM SU: TNM ERP CCA MAV AF-JS -- LAW136 -- 2240 01/03/2007 19:50 EST http://www.prnewswire.com

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