ITS, SEA to merge

Information technology firms ITS Services Inc. and Science and Engineering Associates Inc. will become one.

The two companies will merge in a bicoastal union that both companies' leaders believe will create a strong player in the government market.

ITS works on the Free and Secure Trade (FAST) initiative in the Homeland Security Department, while SEA is the Navy's lead contractor for the Space and Naval Warfare Information Technology Center. The two companies expect the merger to open each company's customers to both firms.

The one unanswered question: What should they call the new entity? "SEA and ITS both have excellent reputations and excellent brands," said Bobby Savoie, chief executive officer of SEA, based in New Orleans. Rebranding will be part of the process of finalizing the merger, said Todd Stottlemyer, CEO of ITS, based in Springfield, Va.

The two companies, which separately have annual revenues of about $100 million, don't plan to designate either the Crescent City, as New Orleans is called for its shape along the banks of the Mississippi River, or northern Virginia as a headquarters. It's an antiquated notion, Stottlemyer said. "Maybe it's 21st century thinking versus 20th century, but headquarters are not particularly important," he said.

The merger fits into the ongoing plans of ITS to grow through acquisitions, with more expected later this year, Stottlemyer said. "Combining the two companies, we can really create a powerhouse," he said.

"We were looking for a partner" also, Savoie added. "We knew that to take [the company] to the next level, we needed a partner."

The move is bringing some immediate cross-selling opportunities, he added. SEA has been interested in working with the Bureau of Census. ITS already has a contract with the bureau, so the merger gives SEA a route to the bureau. Meanwhile, SEA has contracts in the Defense Department and DHS.

After the merger is finalized, the company's executive management will shuffle:

* SEA CEO Savoie will be vice chairman.

* ITS CEO Stottlemyer will be CEO.

* ITS president and chief operating office Paul Leslie will remain president and COO.

* SEA president Daniel Oliver will become sector president for defense, homeland security and intelligence.

* SEA COO Doug Chandler will become sector president for civilian agencies, advanced IT solutions and outsourcing.

* ITS chairman Phil Odeen will remain chairman.