Gallant Capital Acquires the Government Services Business of Navient Corporation
Gallant Capital Partners has announced a definitive agreement to acquire Navient 's (NAVI) Government Services business (NGS). The acquisition target, NGS, specializes in tech-enabled outsourced business processing for U.S. government clients, with leadership positions in tolling and parking technology services. The company also provides critical services including call center support, revenue recovery, program management, and payment processing.
The transaction is anticipated to close in Q1 2025, subject to certain conditions. This deal marks Gallant's second corporate carveout within the past year and will be the third platform investment from Gallant Capital Partners II fund.
Gallant Capital Partners ha annunciato un accordo definitivo per acquisire l'attivit脿 dei servizi governativi di Navient (NAVI) (NGS). L'obiettivo dell'acquisizione, NGS, 猫 specializzata in processi aziendali esternalizzati abilitati dalla tecnologia per i clienti del governo degli Stati Uniti, con posizioni di leadership nei servizi tecnologici per i pedaggi e il parcheggio. L'azienda fornisce anche servizi cruciali tra cui supporto per call center, recupero dei ricavi, gestione dei programmi e elaborazione dei pagamenti.
Si prevede che la transazione si chiuda nel Q1 2025, soggetta a determinate condizioni. Questo accordo segna il secondo disimpegno aziendale di Gallant nell'ultimo anno e sar脿 il terzo investimento piattaforma del fondo Gallant Capital Partners II.
Gallant Capital Partners ha anunciado un acuerdo definitivo para adquirir el negocio de Servicios Gubernamentales de Navient (NAVI) (NGS). El objetivo de la adquisici贸n, NGS, se especializa en procesos empresariales externalizados habilitados por tecnolog铆a para clientes del gobierno de EE. UU., con posiciones de liderazgo en servicios tecnol贸gicos de peajes y estacionamiento. La empresa tambi茅n ofrece servicios cr铆ticos, incluyendo soporte de centros de llamadas, recuperaci贸n de ingresos, gesti贸n de programas y procesamiento de pagos.
Se anticipa que la transacci贸n se cierre en el Q1 2025, sujeta a ciertas condiciones. Este acuerdo marca el segundo desagregamiento corporativo de Gallant en el 煤ltimo a帽o y ser谩 la tercera inversi贸n plataforma del fondo Gallant Capital Partners II.
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Gallant Capital Partners a annonc茅 un accord d茅finitif pour acqu茅rir l'activit茅 de services gouvernementaux de Navient (NAVI) (NGS). L'objectif de l'acquisition, NGS, est sp茅cialis茅 dans le traitement des processus d'affaires externalis茅s habilit茅s par la technologie pour les clients gouvernementaux des 脡tats-Unis, occupant des positions de leader dans les services technologiques de p茅age et de stationnement. L'entreprise fournit 茅galement des services essentiels, notamment le support de centre d'appels, la r茅cup茅ration des revenus, la gestion des programmes et le traitement des paiements.
La transaction devrait se cl么turer au T1 2025, sous r茅serve de certaines conditions. Cet accord marque le deuxi猫me retrait corporatif de Gallant au cours de l'ann茅e 茅coul茅e et sera le troisi猫me investissement plateforme du fonds Gallant Capital Partners II.
Gallant Capital Partners hat eine endg眉ltige Vereinbarung zur 脺bernahme des Gesch盲ftsbereichs Regierungsdienste von Navient (NAVI) (NGS) bekannt gegeben. Das 脺bernahmeziel, NGS, ist auf technologiegest眉tzte ausgelagerte Gesch盲ftsprozesse f眉r US-Regierungskunden spezialisiert und nimmt eine f眉hrende Position in den Bereichen Maut- und Parktechnologiedienstleistungen ein. Das Unternehmen bietet auch wichtige Dienstleistungen wie Call-Center-Support, Einnahmenr眉ckgewinnung, Programmmanagement und Zahlungsabwicklung an.
Der Abschluss der Transaktion wird f眉r Q1 2025 erwartet, vorbehaltlich bestimmter Bedingungen. Dieses Gesch盲ft markiert Gallants zweiten Unternehmensausgliederung im vergangenen Jahr und wird die dritte Plattforminvestition des Gallant Capital Partners II Fonds sein.
- Strategic acquisition of a leading government services provider
- Established position in tolling and parking technology market
- Diverse revenue streams from multiple government service offerings
- Long closing timeline (Q1 2025) introduces execution risk
- Divestiture of revenue-generating business unit from Navient
Insights
This divestiture of Navient's Government Services unit marks a strategic pivot that could significantly strengthen NAVI's balance sheet and streamline operations. The Government Services segment, while profitable, represents a non-core business line that diverges from Navient's primary focus on education loan management and processing.
The timing of this sale aligns with current market conditions where tech-enabled government service providers command premium valuations due to their stable, recurring revenue streams and mission-critical nature. While the transaction value remains undisclosed, similar deals in the government services space typically fetch 8-12x EBITDA multiples.
Gallant Capital's expertise in corporate carveouts and their recent fund raising suggests they have the operational capabilities and capital structure to execute this transition effectively. For NAVI shareholders, this deal could unlock value by allowing management to redeploy capital toward core competencies or return value to shareholders through buybacks or debt reduction.
The sale of NGS represents a significant shift in the government services technology landscape. NGS's strong position in tolling and parking technology systems provides Gallant with an established platform in a growing market segment where digital transformation and automated payment processing are becoming increasingly critical.
The tech stack involved in government payment processing and revenue recovery requires sophisticated integration capabilities and compliance frameworks - assets that command premium valuations in current market conditions. The standalone entity structure could accelerate technology investments and innovation cycles, potentially leading to expanded market share in state and local government contracts.
This divestiture aligns with broader industry trends where large financial services firms are streamlining their business models to focus on core competencies. For Navient, separating from the government services division could improve operational efficiency and strategic clarity, potentially leading to higher valuation multiples as investors prefer focused business models.
The Q1 2025 targeted closing timeline suggests minimal regulatory hurdles, likely due to Gallant's clean antitrust profile in the sector. The transaction's structure as a complete business unit sale rather than a piecemeal disposition indicates strong underlying asset quality and business continuity potential, which should benefit both parties' stakeholders.
NGS provides tech-enabled outsourced business processing to
鈥淣GS is a leader in the government services industry with a proven track record of technology-driven innovation and growth. We look forward to supporting the NGS management team and to a future of continued growth as a standalone business,鈥� said Anthony Guagliano, Partner at Gallant. 鈥淭his acquisition represents Gallant鈥檚 second corporate carveout in the past year and we are pleased Navient chose Gallant on the transaction. We are confident that under our ownership and in partnership with the NGS team, the standalone NGS business will thrive,鈥� added Jon Gimbel, Partner at Gallant.
The acquisition is expected to close in the first quarter of 2025, subject to certain conditions. The acquisition of NGS would represent the third platform investment made from Gallant鈥檚 second fund, Gallant Capital Partners II.
About Navient鈥檚 Government Services Business
Navient鈥檚 Government Services business includes Navient Business Processing Group, Duncan Solutions, Gila (D.B.A. Municipal Services Bureau), Pioneer Credit Recovery and Navient BPO. Across its various segments, NGS provides tech-enabled processing, collections, and record lookups for tolling and parking authorities, outsourced government program management and support, government agency revenue management, and end-to-end payment processing solutions. The Company has approximately 1,200 employees who will be included in the acquisition.
About Navient Corporation
Navient Corporation (Nasdaq: NAVI) provides technology-enabled education finance and business processing solutions that simplify complex programs and help millions of people achieve success. Navient鈥檚 customer-focused, data-driven services deliver exceptional results for clients in education and government. Learn more at navient.com.
About Gallant
Gallant Capital Partners is a private equity firm that invests in technology, business services, and industrial companies. Gallant executes an operationally focused investment strategy with a priority on partnering closely with companies that can benefit from its extensive industry relationships and operating expertise. The firm partners with owners, founders, and management teams to maximize value and drive long-term, sustainable growth for its portfolio companies. Gallant was founded in 2018 and is headquartered in
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Media Contact Information:
Jamie Kim
Gallant Capital
jkim@gallantcapital.com
(310) 362 3309
Source: Gallant Capital Partners
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