INDUSTRY UPDATE | Q1 2026
Defense & Government
Firm Overview
$4Bn+
40+
Closed Tx since Jan. 2020
100+
2024 Valuations
12+
Advisory Clients Exited since Jan. 2021
Corporate Advisory Services
- Strategic Assessments
- Financial Planning & Analysis
- Value Sharing Plans
- Transaction Advisory
- Value Creation Strategy
- Business Valuations
Investment Banking Services
- Sell-Side
- Buy-Side
- Merger
- Recapitalization
- Growth Capital
- Management Buyout
Intel and Cyber News
Companies serving the Intelligence and Cyber Markets encompass a wide range of offerings with a diverse set of skills and market segments. From Artificial Intelligence and Machine Learning to Cybersecurity and support for the war fighter, the people that make up these technology companies are actively involved in national security. Along with these “pointy edge of the sword companies” are support industries in staffing, engineering, finance, and legal, which serve the various needs of this community.
Rudd Confirmed to Lead
The Senate confirmed Gen. Joshua Rudd to lead U.S. Cyber Command and the NSA, ending nearly a year without permanent leadership. Approved 71-29, his selection faced scrutiny over limited signals intelligence experience. Supporters cite his Indo-Pacific and operational background. Rudd will oversee cyber operations, election security, and surveillance programs, while addressing workforce morale and policy debates, including renewal of key intelligence authorities.
FAR 2.0 Changes
FAR 2.0, a sweeping rewrite of federal procurement rules, aims to eliminate nonessential regulations and simplify contracting. While intended to increase efficiency, the shift toward statutory-only provisions and expiring clauses could reduce flexibility for agencies. As a result, contract extensions and modifications may face greater scrutiny, potentially making extensions harder to justify and execute in a streamlined but less prescriptive framework.
LPO Streamlines Acquisition
The CIA unveiled a new Acquisition Framework to accelerate partnerships with commercial technology providers. The approach centralizes vendor vetting and streamlines IT authorization, reducing time from mission need to deployment. Designed to improve speed and agility, the framework enables rapid onboarding of innovative solutions and modernization of core systems to better address evolving national security challenges.
GWAC Eligibility Rules
SBA’s updated recertification rules, effective January 2026, limit small business contract eligibility following acquisitions by large or private equity buyers. Companies losing small status may no longer pursue set-aside orders or exercise option periods on GWACs and MACs. The change heightens M&A complexity, requiring contractors to carefully evaluate timing, structure, and growth strategy before pursuing a sale or recapitalization transaction.
Impact of the NDAA
The FY2026 NDAA accelerates federal investment in AI and cybersecurity, reinforcing these areas as core mission priorities. Beyond funding, the legislation drives adoption through new requirements and faster procurement pathways. For instance, increased use of Other Transaction Authorities (OTAs) enables agencies to rapidly acquire emerging technologies. As a result, buyers are repositioning portfolios toward AI and cyber capabilities aligned with federal demand.
Capital for GovCon M&A
With budget clarity improving and policy uncertainty easing, 2026 is shaping up to be a constructive year for GovCon M&A. New private equity capital is flowing into aerospace, defense, and government services, highlighted by multi-billion-dollar fundraises targeting middle-market platforms. This influx of capital is expected to increase buyer competition, support valuations, and create favorable conditions for both sellers and strategic acquirors.
CCA Government Services & Defense Indices Stock Performance
- Since March 2024, the S&P 500 has gained over 24%, while reaching multiple all-time highs.
- Defense Technology stocks were outstanding performers in 2025 because of increased government spending, innovations in technology, and persistent geopolitical instability.
- Government Services recovered from early losses to end 2025 almost flat. However, this group is down approximately 10% since March 2024.
How CCA Helps Government Contractors
Chesapeake Corporate Advisors provides a framework for business owners to focus on building sustainable value and to explore their succession and exit alternatives. We use our proprietary tools and methodologies to assess the market and maximize value through strategy.
CCA is a leading investment bank with extensive expertise in mergers, acquisitions, divestitures, and corporate advisory. We use a comprehensive approach to assist clients develop and execute a buy-side, sell-side or recapitalization strategy domestically and in cross-border transactions.
At CCA, understanding shareholder value is at the center of everything that we do. Our analysis considers the feasibility of mergers, acquisitions, divestitures, ESOPs, management buy-outs and recapitalizations. We provide an objective, assessment of value that is deeply rooted in qualitative and quantitative analysis using our proprietary methodologies.
CCA’s Government Contracting team is a blend of Corporate Advisory, Investment Banking, and Government Contracting Executives. We have worked with dozens of companies in projects ranging from Sell Side Investment Banking, to Ownership Alternatives, to Valuations to Boards of Directors.
The CCA Government Contracting Team
Charlie Maskell
Managing Partner
Martin O'Neill
Managing Director
Michael Zuidema
Managing Director
Tim Brasel
Managing Director
Katie Kieran
Director
Andy Spears
Director
Dave Morrison
Director
Meghan Smith
Vice President
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