STG Group on Tuesday said it has agreed to acquire Preferred Systems Solutions (PSS) in a $119 million deal adding new capabilities and customers.

STG said it is financing the deal through a combination of debt and equity financing. The acquisition is expected to close during the first quarter subject to regulatory approval.

PSS’s core capabilities are in advanced computing, analytics, program and acquisition management, and cyber and software solutions. The company provides STG with new customers in the Departments of Homeland Security and Defense, and the FBI. PSS has more than 25 government agency clients.

Phil Lacombe, president and chief operating officer of STG Group. Photo: STG Group.
Phil Lacombe, president and chief operating officer of STG Group. Photo: STG Group.

STG said the pending acquisition advances its vision to create a “new breed of high growth, agile business delivering knowledge superiority and information security” to federal customers.

“With the acquisition of PSS, we are advancing our technological agility and ingenuity to meet the most complex and demanding national security challenges facing the U.S.,” Phillip Lacombe, president of STG, said in a statement. “Preferred Systems Solutions has proven excellence in data analytics, cyber security, high performance computing, acquisition and program management, and software development, with particular strength in the intelligence community. The combined company will have stronger core competencies, greater scale and depth, the ability to develop new capabilities and focus on a wider range of customers managing larger, more complex federal programs.”

PSS last October acquired Synaptic Solutions, the sixth deal for the company in a 30-month period, expanding its professional services capabilities and its presence with the intelligence community.

STG and PSS are both based in Northern Virginia. STG’s financial advisor on the deal is Sagent Advisors.