Edgewater Sells IntelliMark Division

Edgewater Technology Inc. has sold IntelliMark, its information technology staffing and solutions division, and the division headquarters will be moved from Fayetteville to Little Rock.

IntelliMark was sold to Charlesbank Capital Partners LLC, a private equity and real estate investment firm based in Boston, and to the management of IntelliMark for about $42.7 million in cash.

IntelliMark had revenue of $140.1 million and EBITDA of $6.7 million for the first nine months of the year.

The sale, which was announced Nov. 17, paves the way for the move of Edgewater Technology Inc., formerly StaffMark Inc., from Fayetteville to Boston, where the Edgewater Technology e-solutions division is based.

During the past year, StaffMark has spun off its Robert Walters financial and accounting division in London, bringing in $199.2 million, and sold two of its three other divisions: StaffMark commercial staffing, for $190.1 million, to Stephens Inc. of Little Rock and Strategic Legal Resources, the legal support staffing division, to a company owned by a group of investors including MidMark Capital II LP and Edwardstone & Co., for $13.25 million. Edgewater Technology Inc. is still trying to sell its ClinForce clinical trials division.

Stephen R. Bova, who was president and chief operating officer of Edgewater Technology Inc., is part of the IntelliMark ownership group. Bova will serve as chairman and CEO of IntelliMark.

IntelliMark’s headquarters, which previously consisted of only Bova in Edgewater’s Fayetteville office, will move to Little Rock after Jan. 1. About 15 will be employed in the Little Rock office, Bova said.

IntelliMark has three divisions and a total of 1,660 employees in 23 locations across the U.S. IT Resources provides IT staffing and consulting through 20 offices. The other divisions are i.source, based in Walnut Creek, which manages on-site staffing for large companies, and IT Solutions, based in Hurst, Texas, which offers network consulting and other services.

Clete Brewer, StaffMark’s CEO, cited IntelliMark as ground zero for problems the company encountered in early 1999, which caused StaffMark’s stock to plummet in the wake of a lower-than-expected earnings report.

“Exacerbated by the Y2K staffing bubble, information technology staffing companies have had a very difficult time for the last year and a half as an industry,” Bova said. “But we believe in IntelliMark we have improved the underlying fundamentals of the company.”

Bova left Electronic Data Systems, where he was head of the global banking division, and began working for StaffMark in September 1999. Based in New York City, EDS is one of the largest providers of information technology in the world. Before that, Bova worked for Alltel Corp. in Little Rock for 11 years and served as president of the global financial division.

For the nine months ended Sept. 30, IntelliMark’s revenue declined 28.5 percent to $140.1 million, gross profit declined 34.1 percent to $37.7 million, and EBITDA declined 68.7 percent to $6.7 million compared with results for the same nine-month period of 1999.

Charlesbank Capital Partners is a private investment firm with more than $2 billion in capital committed to acquisition and financing for growing companies and developing real estate assets. The firm has offices in Boston and New York.