Sevatec, Octo Consulting announce merger

Fairfax-based software company Sevatec announced Tuesday it has merged with Reston-based government technology company Octo Consulting Group.

The combined organization will have nearly $300 million in annual revenue and 1,100 employees. 

Founded in 2003, Sevatec provides design, DevSecOps, security, cloud service integration, data engineering and automation services and has won nearly $400 million in recent contracts. Octo was founded in 2006 and specializes in information technology consulting for the federal government. Some of its clients include the U.S. Patent and Trademark Office, the U.S. Securities and Exchange Commission and the General Services Administration.

“With this transaction, I firmly believe we have created a unique, market-shaping organization that is unmatched in terms of its collective ability to be a pure-play modernization and technology solutions provider to the federal government and its wide-ranging missions,”  Octo CEO Mehul Sanghani said in a statement.

Under the merger, Sanghani will serve as the combined company’s CEO. Sevatec founder and CEO Sonny Kakar will serve as vice chair of the board and head of strategy, while Sevatec Chief Growth Officer Tim May will continue in that roles for the combined organization. Sevatec Executive Vice President Chuck Schefer will serve as executive vice president of managing programs in the GSA, DHS and USPTO markets. 

The combined company will “continue as two individual brands for a brief period given the proximity to the holidays,” says Octo spokesperson Ethan Meurlin. “We will be begin integration in earnest in January, including combining the two brands.” A new brand name has yet to be announced and will be part of a complete brand assessment in 2021, Meurlin says.

“While the industrial logic of the merger resonated tremendously with us both, it also became evident that it would create significant growth opportunities for our employees and allow the combined business to compete at scale and solve some of the most pressing challenges facing our customers,” Kakar said in a statement. “In a market full of multibillion-dollar organizations that provide a wide variety of traditional products and services, customers are seeking highly specialized, mid-sized technology partners with deep experience in digital modernization, which is exactly what the combination of Octo and Sevatec offers.”

Sheppard Mullin served as legal adviser to Octo in this transaction, while Pillsbury Winthrop Shaw Pittman LLP served as legal adviser and Baird served as financial adviser to Sevatec.

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