Reston, Va.-based government technology services contractor STG Group has agreed to acquire software engineering and computing provider Preferred Systems Solutions for $119 million in a push to add new footprints in the intelligence community and other national security agencies.
STG said Tuesday it expects to close the transaction by the end of March pending regulatory reviews and will fund the purchase through new debt and equity financing.
STG announced the pending deal nearly 15 months after the company completed its combination with special purpose acquisition — or “blank check” firm — Global Defense & National Security Systems in a deal valued at $165 million in cash and stock.
Founded in 1991 and headquartered in McLean, Preferred Systems Solutions offers federal agencies technology-related services in areas such as high-performance computing, cybersecurity, cloud computing, business applications and business applications.
STG President Phil Lacombe — a 2017 Wash100 inductee — said the company also sought to add new acquisition and program management and software development work for intelligence agencies through the transaction.
PSS’ customer base includes the intelligence community, U.S. Army, U.S. Navy, Defense Logistics Agency, Transportation Command, Defense Advanced Research Project Agency, FBI, and the departments of Homeland Security and Transportation.
STG cited the transaction as part of efforts to integrate both companies’ cyber, data and software security service offerings for reach into programs related to government policy and spending.
Sagent Advisors advised STG on the transaction’s financial aspects as Morrison & Foerster LLP acted as legal counsel.