Wednesday, March 10, 2010

General Harding: PEU Partner

General Robert Harding is the new nominee for head of the Transportation Security Administration. He headed his own security firm, Harding Security Associates (HSA), which does work in the Intelligence and Defense communities. The General's firm, started in 2003, has small business, minority owned and disabled veteran owned designations. HSA partnered with at least two Carlyle affiliates since its inception, QinetiQ and Booz, Allen, Hamilton.

The General announced he would sell his firm to Six3 Systems in June 2009. Six3 Systems was founded in April 2009 in partnership with GTCR Golder Rauner, LLC. Obama's Chief of Staff Rahm Emanuel has strong ties to GTCR from his investment banking days. The press release regarding the acquisition of HSA provided the following descriptions:

About Six3 Systems
Six3 Systems, headquartered in Fairfax, Virginia, is a company focused on acquiring government services providers with a focus on national security.

About GTCR
Founded in 1980, GTCR Golder Rauner, LLC is a private equity investment firm and long-term strategic partner for outstanding management teams. The Chicago-based firm pioneered the investment strategy of identifying and partnering with exceptional executives to acquire and build companies through a combination of acquisitions and strong internal growth. GTCR currently manages more than $8 billion of equity capital invested in a wide range of companies and industries.

The parties commented on the deal. "Since we announced the formation of Six3, we have actively targeted providers of specialized services in high-growth areas within the defense budget. We believe HSA fits squarely within this strategy,” added GTCR Principal Craig Bondy. “GTCR and Six3's investment in HSA is an excellent example of our partnering with an industry-leading executive and pursuing strategic acquisitions."

“I am very pleased to have Harding Security Associates join forces with Six3 Systems,” commented Major General Robert A. Harding, USA (Ret.), Chief Executive Officer of HSA. “I believe this acquisition will provide enhanced career opportunities for our people while continuing our track record of outstanding service and support to our customers.”

How did the General benefit from the sale, cash, Six3 equity or a combination? Did HSA keep their minority-owned and disabled vet designations after the sale to GTCR Golder Rauner?
How might General Harding send work to his old firm as TSA Chief? Harding Security is at the forefront of “biometric enabled intelligence analysis.” Is TSA going biometric?
Six3 Systems didn’t stop with the purchase of Harding Security. It added BIT Systems, an intelligence, surveillance, and reconnaissance (ISR) company.
Six3 claims a Cyber Security niche. It’s a sweet spot to be in with the heightened emphasis on cyber defense, as well as offensive capabilities.
Should General Harding have a stake in Six3 Systems, he could look after his old employees in his new role. The Government-Industrial Monstrosity, Eisenhower’s MIC on steroids, remains alive and well.
Given Homeland Security monitored social networking sites during the Vancouver Winter Olympics, Big Brother could be here. Only General Harding knows if Six3 Systems had a role in that peek into social posts and tweets. The public knows TSA wants to look into the general public’s briefs and panties. It gives new meaning to generals and privates.
Update: This post originally appeared on Economic Policy Journal. Rumor suggests it was popular with DOD, DHS & NATO. Who knew PEU Report had fans in government ranks?
Update 2: The Pentagon investigates spying allegations against International Media Ventures, a military contractor in Afghanistan. IMV used layers of subcontractors, some with special forces trained personnel. Why would the Pentagon make this public now? Is the focus on Michael Furlong a look away from General Harding's outfit? Why does retired military man Furlong not have his rank in the piece? Furlong headed up Pentagon PSYOPS, served in the Air Force's Space Policy Office and worked for SAIC and Booz, Allen, Hamilton. I smell a PEU diversion.
Update 3: General Harding withdrew his nomination for TSA Chief

Update 4-26-12:  Six3 Systems purchased Ticom Geomatics, a provider of geolocation and intelligence, surveillance and reconnaissance services for the defense and intelligence industries.