The Government Accountability Office in January denied a protest by losing bidder General Dynamics [GD] of a potential $2.7 billion contract the Department of Homeland Security awarded last fall to Peraton to provide information technology services to manage the department’s Hybrid Computing Environment (HCE).

GD’s IT business previously managed Data Center 1, which is within the HCE.

The award to Peraton, which has a five-year base period, a three-year option and a two-year option, was made under the Data Center and Cloud Optimization (DCCO) support services program.

GAO’s decision document shows that Perspecta, which was the original bidder before being acquired by Peraton, offered a lower price than GD. It also says that DHS rated both company’s final proposal revisions equally except in the area of Technical Approach, where Perspecta was rated with “high confidence” and GD “some confidence.”

GAO says that in its protest, GD challenged “virtually every aspect of the agency’s evaluation of proposals under the non-price factors, and asserts that the agency failed to conduct meaningful discussions.”

In its decision, GAO in short said denied the protest because DHS’ evaluation “was reasonable and consistent with the terms of the solicitation” and because the department had identified the weaknesses in GD’s proposal.

A second DHS data center, which was managed by Hewlett Packard Enterprise [HPE], is being eliminated through DCCO.