HUNTSVILLE, Ala. - NexTech Solutions (NTS), a provider of technology and engineering solutions to the U.S. Department of Defense (DoD), has reached an agreement to purchase Rome Research Corporation (RRC) from PAR Technology Corporation (NYSE: PAR). The deal, valued at $102 million, is expected to finalize by the end of the second quarter of 2024.
NTS, which operates in locations including Tampa, Huntsville, and Northern Virginia, specializes in supporting U.S. DoD missions with systems engineering, testing and evaluation, and operational support. The acquisition of RRC, a subsidiary of PAR Government Systems Corporation, is seen as a strategic move to diversify NTS's customer base and expand its services globally.
Joseph Paull, CEO of NTS, highlighted the company's history with overseas services and praised RRC for its breadth of services and strong reputation. The integration of RRC into NTS's Mission Support Solutions (MSS) business unit is expected to enhance the company's offerings and capabilities.
Kris Nagy, EVP of MSS at NTS, emphasized the company's commitment to ensuring a smooth transition for RRC's employees and customers. NTS has been in operation for over 11 years and has recently received a strategic investment from Clairvest, a private equity fund managing over $3 billion in assets, to support its growth in the defense technology sector.
The information for this news article is based on a press release statement.
In other recent news, PAR Technology Corporation reported a substantial increase in its annual recurring revenue (ARR), growing by 25%, and a strategic acquisition of Stuzo in its fiscal year 2023 fourth-quarter financial results. Despite a drop in hardware sales, the company expects to become EBITDA positive by the third quarter of 2024. The total revenues for the quarter were $105.5 million, a 5% year-over-year increase, while the net loss was $18.3 million.
The company's subscription services, including Operator Cloud and Engagement Cloud segments, have shown significant growth. The Operator Cloud segment alone saw a 39% growth. The acquisition of Stuzo aims to enhance the company's technology offerings for convenience stores.
In addition to these developments, PAR Technology is implementing rollouts with Burger King and Wendy's (NASDAQ:WEN), expecting growth between 20% and 30%. The company aims to be EBITDA positive by Q3 2024, focusing on free cash flow and improving unit economics. PAR Technology is also working towards reducing quarterly operating expenses through the year, excluding acquisitions.
InvestingPro Insights
In light of NexTech Solutions' (NTS) recent acquisition of Rome Research Corporation, investors and industry watchers are closely monitoring the financial health and market performance of PAR Technology Corporation (NYSE: PAR), the seller in this transaction.
According to real-time data from InvestingPro, PAR Technology Corporation currently boasts a market capitalization of $1.53 billion USD. Despite not expecting to be profitable this year, as indicated by one of the InvestingPro Tips, the company's liquid assets are reported to surpass its short-term obligations, suggesting a degree of financial resilience.
InvestingPro Data further reveals a Price/Earnings (P/E) Ratio of -16.62, reflecting market sentiment about the company's earnings potential. Moreover, PAR has experienced an 11.95% revenue growth in the last twelve months as of Q1 2024, alongside a gross profit margin of 24.63%. These figures may signal to investors that while the company is navigating through unprofitability, it has managed to grow its revenue base and maintain a solid gross profit margin.
An InvestingPro Tip worth noting is that PAR has not been profitable over the last twelve months and does not pay a dividend to shareholders, which may influence investment decisions for those seeking immediate returns or income through dividends. However, the company has seen a high return over the last decade, which could interest long-term investors.
For those considering a deeper dive into PAR Technology Corporation's financials and market performance, InvestingPro offers additional tips and insights. By using the coupon code PRONEWS24, readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a total of 6 InvestingPro Tips that could further inform investment strategies.
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