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Six3 Systems: Smart Solutions for the Intelligence Community

May 14, 2015

Six3 Systems is a prototypical example of GTCR’s Leaders Strategy™. Six3 was formed in 2009 with Bob Coleman, former President and COO of ManTech International, and Jack Pearlstein, former CFO of GTCR portfolio companies Solera Holdings, DigitalNet Holdings and AppNet.

GTCR formed Six3 with Mr. Coleman and Mr. Pearlstein to pursue acquisitions that would fill an unmet need of providing advanced and highly technical processing and analytical capabilities to the U.S. government. With significant consolidation taking place in the defense services sector, the Six3 thesis was to build a mid-market provider that combined the agility and innovation of small companies with the requisite scale and scope to service major programs for the government.

From the outset, Six3 focused on the mission-critical and high-growth areas of signal processing and analysis, intelligence services and cyber security. GTCR and Six3 collectively considered and reviewed over 100 potential acquisition targets and acquired four companies that best fit the Six3 vision.

Each of the four acquired companies was founded by an entrepreneur with a unique background and cultural approach. GTCR and Six3 were able to employ a complex capital structure, including various tranches of preferred and common equity, seller notes and other seller interests, to incentivize key management members to continue in their leadership roles. With this proper alignment of incentives, Six3 was able to integrate the acquired companies while protecting the entrepreneurial spirit that created each company’s historical and ongoing success. Six3 was also able to provide centralized business development, finance and G&A support while ensuring the unique strengths and cultures of each business remained in place. The integrated business was able to cross-sell its unique solutions to new agencies and pursue larger contracts previously unavailable to the individual companies.

We believe the combination of a well-defined thesis and successful integration translated into exceptional operating performance. Over a five-year period, Six3 was able to organically grow earnings while many of its competitors were shrinking, thus creating a company of strategic significance in the industry.

After a robust process, GTCR announced in October 2013 the sale of Six3 Systems to CACI international. The sale was particularly meaningful in that the process was composed of solely strategic buyers who understood the value of Six3’s capabilities. This may be best reflected by the fact that it represented the largest of CACI’s 55 acquisitions in its history, which we believe illustrates the strategic value and highly specialized capabilities built by Mr. Coleman and his team.