Navigating Government Contract Transactions

At Rock Hall, we understand that “contract vehicles,” are crucial pathways to growth and opportunity in the government contracting (GovCon) market. Our specialized expertise in this unique niche of M&A helps firms efficiently acquire or divest these valuable assets, providing full transaction lifecycle support.

Why Acquire a Government Contract Vehicle?

Many firms seek to acquire government contract vehicles to achieve strategic objectives and overcome market entry barriers. You might consider acquiring a contract vehicle if you need direct access to specific agencies or markets. For example, many agencies purchase IT services through government wide acquisition contracts like GSA’s OASIS+. Without access to such a vehicle, a company simply cannot sell its services to those agencies.

Buying an existing vehicle offers immediate market access. This strategy is vital for rapid growth or market expansion. Buying a contract can also help you avoid waiting years for the next generation of that contract to be awarded.

Why Divest a Government Contracts?

Conversely, firms have strategic reasons to sell off contract vehicles or non-core assets. You might possess an underutilized or unused contract vehicle that is not being fully leveraged within your existing business because your customer set is using some other contract. Divestiture of a non-core business segment or assets is also common, particularly for private equity-backed platform companies or other owners looking to focus their time and investments on their core business and not be distracted by non-core business or perhaps units of an acquired company that don’t fit your strategic direction. Furthermore, if an acquisition results in your company holding duplicate contract vehicles, selling one can monetize an otherwise inactive asset, ensuring efficient use of resources.

How Rock Hall Facilitates Contract Transactions

Buying and selling government contract vehicles involves a specialized process, distinct from traditional company M&A. Rock Hall’s expertise ensures a smooth and effective transaction. For asset purchases, the Federal Acquisition Regulations (FAR) require a process called novation, where the government must approve the transfer of contracts from the selling to the buying company. We meticulously manage this process, working to enhance the likelihood that you will receive the government’s novation approval in accordance with the FAR. Our unique expertise includes knowing which contracting officers are open to novations and which specific vehicles have been successfully novated in the past, which helps to streamline the process for you.

Unlike selling a company based on profits and backlog, contract vehicles are “empty hunting licenses” with no inherent revenue or profit. We leverage our experience from numerous past transactions to help you accurately price these assets, understanding the market range for such sales. Our track record for getting contract vehicle novations approved is very successful. While approval times can vary significantly—from under a month to over a year—we guide you through these timelines, managing your expectations every step of the way.