Information technology services provider Preferred Systems Solutions (PSS) on Tuesday said it has acquired federal services provider Government Contract Solutions (GCS) in a deal that expands its presence in the intelligence community and the Department of Homeland Security.
Terms of the deal were not disclosed. PSS, which is based in Northern Virginia, has about 320 employees following the acquisition. GCS had about 100 employees and its operating management is staying with the company, Scott Goss, CEO of PSS, told Defense Daily on Wednesday.
PSS currently does about 35 to 40 percent of its business with the intelligence community and also counts the Army, Navy, Defense Logistics Agency, DHS, Transportation Command, Departments of Agriculture, State and the Veterans Administration among its key clients. The company’s core capabilities are in software development, systems engineering, program management and acquisition support, IT, cyber security, intelligence and staffing services.
In addition to expanding PSS’ customer base in key areas, GCS also adds program management, acquisition support and systems engineering capabilities, Goss said.
The GCS deal is the third this year for PSS, which is at the beginning of an acquisition campaign Goss said. This summer the company acquired Envision Technical Services, which boosted work in the intelligence community, and Global Services & Solutions, which added high-end engineering and program management in support of the Navy, Goss said.
PSS doesn’t disclose its sales but Goss said that the company expects to grow organically this year, and combined with additional acquisitions, have about $200 million in sales a year from now. He also said that the company wants to get its work with the intelligence community to at least 50 percent of its overall business.
Market conditions remain “tough” and PSS had been flat the past two years, Goss said.
The mergers and acquisitions market is ripening, Goss said, as valuations for some companies have “come down to some degree,” interest rates are good and banks want to lend to “well-managed” companies. He said PSS is looking for small deals as well as properties more than $75 million.
PSS is a portfolio company of CM Equity Partners, which wants to grow the business, Goss said.