PSINet Subsidiary Sells Two Properties

Ciber Inc. has signed an agreement to acquire two Metamor properties from PSINet subsidiary PSINet Consulting Solutions Holdings, Inc. The transaction is part of an ongoing Chapter 11 process.

by Roy Mark of dc.internet.com [September 11, 2001]

Ciber, Inc. (NYSE:CBR) has signed a definitive agreement to acquire the $90 million revenue rate, public sector IT service entities Metamor Industry Solutions, Inc., and its subsidiary, Metamor Government Services, Inc., from PSINet Consulting Solutions Holdings, Inc., itself a wholly-owned subsidiary of bankrupt Internet backbone PSINet, Inc. (OTC:PSIXE).

Concurrently, PSINet Consulting Solutions Holdings filed for protection under Chapter 11 of the U.S. Bankruptcy Code. Neither of the entities being acquired by Ciber in the transaction nor any other subsidiary of PSINet Consulting Solutions Holdings is included in today's bankruptcy filing. In its Chapter 11 filing, PSINet Consulting Solutions Holdings filed a motion with the United States Bankruptcy Court seeking approval of the transaction.

Additional financial details of the transaction were not disclosed.

The Ashburn, Va.-based backbone provider PSINet acquired Metamor Worldwide Inc. in March 2000 for $1.9 billion. Analysts would later cite the deal as a decisive factor leading to PSINet's eventual bankruptcy.

"The root of this business was Cutler-Williams, Inc., one of the earliest operators in the IT services industry. A federally-oriented acquisition (Dynamic Resources, Inc.) was added in 1998. Through two ownership transfers, first Cutler-Williams to Corestaff in 1997 (later named Metamor), then to PSINet in 2000, Ed Burns, the founder of this Public Sector Practice, kept together a proud and quality group of employees, delivering services to an array of state and local governmental clients, and more recently to the U.S. government and a number of private sector clients. Ed has done an exemplary job, particularly throughout the recent tumultuous period," said Mac Slingerlend, Ciber's president and chief executive officer.

The Colorado-based Ciber is an international e-business integrator. Founded in 1974, the company's consultants now serve client businesses from 35 Ciber, 15 DigiTerra, 3 Solution Partners, and 4 Enspherics offices in the U.S., Canada, and Europe.

"We couldn't be more pleased then to join Ciber. Our management team preferred to join Ciber several years ago, but wasn't able to do so. Ciber is a quality operator in the IT services sector. We complement very well their offerings. Ciber was the only potential acquirer, of several we talked to, that our management team universally wanted to support. We are already working together on joint projects. We cannot wait to finish the legal process and begin to deliver our services under the Ciber banner," said Burns, president of the Public Sector Practice of Metamor Industry Solutions.

Burns added, "Our Public Sector Practice represents 800-plus skilled associates in 13 branch offices, six of which are in state capitals, and several other government installation sites in the U.S. Our state work includes Illinois, Florida, North Carolina, Georgia, California and Texas, among other growing relationships. We offer unparalleled state and local government expertise in Law & Justice, Health and Human Services, and Transportation environments. In the federal sector, our clients include the Departments of Defense, Transportation and Health and Human Services, the U.S. Coast Guard, the U.S. Army Reserve Command, and others. Ciber has a very credible public sector client base; combining our efforts creates more critical mass and even greater services and experience for our clients."

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