Millstein Changes Guard at DLT

Typically, when an operating partner is installed as the leader of a recently acquired portfolio company by private equity ownership, it’s safe to assume the new investment is in need of a radical shift in direction. There are exceptions, however, like Millstein & Co.’s recent acquisition of DLT Solutions.

Millstein announced operating partner Alan Marc Smith had been installed as chief executive officer at DLT, replacing Rick Marcotte who led the company for more than 10 years. Marcotte will not be far from DLT, however, as he is continuing on as vice chairman of the board and a consultant as well as taking an equity stake in the business.

“This is a tremendous business,” says Smith. “It is not a turnaround.”

DLT’s revenues in 2014 were $900M, nearly a 4 percent improvement on the $857M in revenues the previous year, according to reports.

DLT is an IT software and solutions provider to federal, state, and local government as well as education customers. The company is a value-added reseller (VAR) of software and hardware products and services, as well as a provider of technical support, and focuses on a number of sectors, including transportation, utilities, and manufacturing.

Smith is not new to the VAR industry. He will rely upon 25 years of experience, including his time as CEO of Westcon Group, to grow DLT’s customer and vendor bases, all the while maintaining the business’ core operations.

DLT’s experience contracting with nearly all levels of government worked hand-in-hand with Millstein’s senior leadership background of working with the public sector, including the U.S. Treasury Department and the Office of Management and Budget. Smith’s plans include leveraging Millstein’s and DLT’s experiences, combined with his own industry knowledge, to improve operations. Emerging technology, such as leveraging the cloud, is of particular interest to Smith. He says this will continue to be an ongoing growth platform for DLT.

“[We are going to] align our value proposition to the cloud,” explains Smith. “This initiative continues to be a strong play for the company.”

Given the natural fit of public sector expertise between DLT and Millstein, as well as Smith’s pedigree it is not surprising those involved in the deal are excited about the company’s future.

“We have great confidence in Alan to run the company,” says Michael Duran, a Millstein partner.