Harrison Street Capital Buys MCR LLC

Harrison Street Capital has acquired a majority stake in MCR LLC, a -based provider of program management services to the federal government. In related news, MCR has bought aeronautical and technical services consulting firm Aerodyne Inc. from Abraxas Corp. No financial terms for either transaction were disclosed.

PRESS RELEASE

MCR, LLC, a premier provider of integrated program management services to the federal government, announced today two major transactions that position the company for significant growth in the government services sector.

MCR has completed the sale of a majority stake in the company to Harrison Street Strategic Services, L.P., an affiliate of Harrison Street Capital, LLC—a diversified investment company based in Chicago with investment platforms in private equity, technology innovation and real estate. Harrison Street will provide investment resources and guidance to support robust business growth.

In addition, MCR has completed the purchase of Aerodyne Inc. of Huntsville, Ala., from Abraxas Corporation. The acquisition of Aerodyne, a leading aeronautical and technical services consulting firm, will enable MCR to expand its offerings of program management services, while also providing opportunities to serve new government customers.

“These are transformational events for MCR,” said CEO and President Neil F. Albert. “With Aerodyne’s complementary program management skills and Harrison Street’s financial backing, MCR will be able expand our customer base and compete for larger, more diverse government contracts via continuous improvement in the quality and scope of the services MCR provides its customers and strategic acquisitions.”

Harrison Street Strategic Services intends to use its investment in MCR as a platform for entrée into the government services market. Co-founder and Chairman Christopher Galvin is the former Chairman and CEO of Motorola, and brings an extensive background in federal services and the government market. Co-founder and President Michael Galvin served as Assistant Secretary of the U.S. Commerce Department for Export Administration from 1989-1992. Michael Galvin also serves as non-executive Chair of the Board of MCR.

“We are privileged to have been invited by MCR senior management to strengthen MCR’s financial profile and to lead finance the future expansion of MCR’s service businesses,” Christopher Galvin said. “We are experienced in government contracting, understand the industry and like the business in which MCR is positioned.”

Harrison Street completed its majority stake purchase from Lau Technologies on June 26. Terms of the transaction were not disclosed.

MCR’s acquisition of Aerodyne provides the company with a strong position in Army aviation and the Huntsville market, which is home to the Army’s Redstone Arsenal. Founded in 1995, Aerodyne has 75 employees and serves numerous Army customers. Aerodyne specializes in aeronautical systems and provides full spectrum technical solutions, including program management, aviation integration, testing and certification, training and requirements development, and system lifecycle management for manned and unmanned systems.

“Huntsville is a growing market in the defense and space business,” Mr. Albert said. “In one location, we are touching nearly all of our major customer bases, which include aviation and space support for the Air Force, Navy, Federal Aviation Administration, NASA, missile defense, intelligence agencies—and now the Army.”

MCR, which concluded its purchase of Aerodyne on June 30, did not disclose the terms of the acquisition.

The acquisition also adds to MCR’s expertise in unmanned aviation, which already included the Air Force Global Hawk and Predator B programs, as well as the Navy’s Joint Unmanned Combat Aircraft System (J-UCAS) program. “Aerodyne is recognized as one of the leading providers of lifecycle acquisition support for UAV programs, and brings with it a culture of innovation and excellence,” Mr. Albert said. “The acquisition of Aerodyne will enable us to expand the breadth of our systems engineering and other program management services, and provides new opportunities to serve both civilian and defense clients.”

Aerodyne President Peter Blocker will continue to manage the organization under its new name, MCR Aerodyne, a wholly owned subsidiary of MCR. “We are very excited about Aerodyne’s future with MCR and the resources they can bring for future growth opportunities,” Mr. Blocker said. “MCR is a recognized leader in our market, has significant experience working in the Unmanned Aircraft Systems community, and will provide us great opportunities across the Department of Defense and other federal agencies.”

Mr. Albert noted that MCR’s primary services are aligned with new government initiatives aimed at improving acquisition oversight and reducing procurement costs. “Government agencies are increasing their focus on transparency and accountability of programs, and that’s precisely what we do. MCR enables program officials to more efficiently and effectively develop, build and deploy sophisticated IT and weapons systems,” Mr. Albert said, adding, “With Harrison Street’s strong financial backing, MCR is well-positioned to make additional strategic acquisitions similar to Aerodyne and achieve significant growth in the years ahead.”

MCR, LLC is a McLean, VA-based professional services firm with over 500 professionals that specializes in Integrated Program Management services for the federal government. MCR is recognized as one of the nation’s premier providers of strategic planning, cost/schedule analysis, program assessment and acquisition management services. Since 1977, MCR has been providing management consulting and research support for a variety of federal and commercial clients. More information on MCR can be found at www.mcri.com.

Harrison Street Capital, LLC is a Chicago-based diversified investment firm with operating/financing platforms in real estate, private equity and technology innovation. Harrison Street’s investment focus is in the growth, yet also recession-resistant, sectors of health care, education and infrastructure. With its lead majority investment in MCR, Harrison Street adds to its private equity platform the government program management services sector, which essential service sector is consistent with its defensive, yet opportunistic, investment focus.