Military equipment supplier Atlantic Diving Supply loses small business status

A dive shop that became one of the Pentagon’s biggest suppliers of military equipment, medical supplies and tactical special forces gear has been stripped of its small business status, pumping the brakes on a fantastical decade-long run for the Virginia Beach-based company. Atlantic Diving Supply has benefited from privileges associated with being a small business for the better part of two decades, limiting its competition in an insular but lucrative military equipment market. The company received more than $2.5 billion from federal agencies last year and won defense contracts set aside for small businesses as recently as last month. But the U.S. Small Business Administration, which determines eligibility for government contract set-aside programs, recently ruled that it no longer qualifies as a small business, representatives from the company and the SBA said Monday.