Perspecta recently signed an agreement with Hewlett Packard’s HPI Federal [HP] to help with services and hardware integration for the Navy’s Next Generation Enterprise Network (NGEN) program, the company’s CEO said in a quarterly analyst call May 21.
The Navy is replacing and expanding the legacy NGEN contract vehicle that provides information technology capability and support services to the Navy and Marine Corps with the NGEN-Re-compete (NGEN-R).
As part of the move to NGEN-R, the service split the work into separate contracts for End-User Hardware (EUHW) and Service Management, Integration and Transportation (SMIT) in a bid to save money. As the incumbent on NGEN, the Perspecta is the incumbent on both portions for NGEN-R.
The Navy awarded a potential $1.4 billion EUHW NGEN-R contract to HPI over Perspecta last October (Defense Daily, Oct. 9, 2019).
During the call, Perspecta president and CEO Mac Curtis explained the company will probably run the current NGEN EUHW work through July before becoming a subcontractor to maintain current equipment.
“What I can tell you is we just signed an agreement with HPI… we have just signed a contract with them for $125 million, $130 million over about 2.5 years to help them the services and integration of the hardware,” Curtis said.
He said that contract work will probably start at the end of July “and roughly go for 2.5 years and well figure out the run rate, but that’s really kind of the focus.”
However, he underscored in this role Perspecta will not be buying hardware and has not bought hardware for NGEN work “for a bit.”
Company senior vice president and chief financial officer John Kavanaugh elaborated this is “just providing legacy support” to assets for their remaining useful life.
A Perspecta spokesperson declined to comment on the agreement by publication time.
In February, the Navy awarded Leidos [LDOS] the $7.7 billion NGEN-R SMIT award over Perspecta and General Dynamics [GD] (Defense Daily, Feb. 6).
While Perspecta did not protest the HP EUHW award, in March, it filed a protest with the Government Accountability Office (GAO) over the SMIT award a week after fellow competitor GD protested it. The GAO said the decision is due by June 17 (Defense Daily, March 11).