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March 21, 2012
Transaction Analysis
On Assignment Inc. (Nasdaq: ASGN)
to Acquire Apex Systems, Inc.


Financial Overview:

  • Transaction Value: $600M
  • Transaction Structure: Cash and Stock
  • Enterprise Value: $600M
  • EV/Revenue: 0.9X
  • EV/EBITDA: 9.2X  


martinwolf Analysis:

  • On Assignment, Inc. (ASGN), a Life Sciences and Healthcare staffing firm, has signed a definitive agreement to acquire Apex Systems Inc, a privately-held information technology staffing and services firm, for $600M ($383M in cash and $217M in newly-issued stock). To fund the deal, ASGN obtained a commitment for a new $540M senior secured credit facility to finance the cash portion of the purchase price, repay existing debt of ASGN and Apex, and pay for transaction expenses. The transaction is expected to be accretive in 2012 and beyond, excluding transaction-related costs.On Assignment, Inc Logo
  • In 2011, Apex Systems achieved approximately $700M in revenue and adjusted EBITDA of $65M. Historically, Apex has achieved a CAGR of over 30% since 2000 and expects to achieve double-digit top-line growth in 2012.
  • The transaction is a prime example of a smaller, publicly-traded company buying a larger private IT services company. The combined entity of ASGN and Apex will result in the second largest staffing firm in the United States, with combined pro-forma 2011 revenues of $1.3B.
  • Apex augments ASGN's IT staffing services by providing a broader spectrum of services as well as strengthening existing IT staffing capabilities. In addition, Apex helps ASGN reach their five-year strategic plan of $1B in revenue ahead of schedule.
  • ASGN stock was up over 26% on news of the acquisition as the company will surpass $1B in revenue and achieve economies of scale, as well as pricing power.
  • ASGN has been aggressively acquisitive in the last few years, with the following acquisitions:
    • April 2010 - The Cambridge Group;
    • July 2010 - Sharpstream Life Sciences Limited;
    • February 2011 - Valesta;
    • July 2011 - Healthcare Partners; and 
    • Apex is by far ASGN's largest acquisition, trumping its Jan 2007 purchase of Oxford Global Resources for $215M.
  • M&A within the IT staffing space has been healthy with recent notable deals including:
    • Sverica International's growth equity investment in The Bartech Group earlier this month;
    • Adecco's January announcement to acquire Japan-based VSN;
    • Recruit Co.'s acquisitions of both Advantage Resourcing and Staffmark Holdings in Dec 2011 and Oct 2011 respectively;
    • Randstad's acquisition of SFN Group in Aug 2011.
  • ASGN has been preparing for a rebound in the economy and is well positioned to benefit from it, particularly in the improved US employment market.
  • martinwolf expects more IT staffing consolidation related deals to follow.

Please go here to read the press release.


martinwolf was not the adviser in this transaction.  


To learn more about this transaction or our firm, contact Tim Mueller 

About martinwolf    


Based in Silicon Valley, martinwolf is a leading middle market M&A Advisory focused on companies with services-based business models. Since 1997, our team has completed more than 115 transactions in six countries. We are a five-year member of the Merrill Lynch PS Referral Network, and were selected as ICICI Bank's (India's leading private bank) exclusive strategic partner for acquiring U.S. IT companies. martinwolf is a member of FINRA and SIPC. For more information, visit


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