Singapore Telecommunications (Singtel) has agreed to acquire a 98% stake in US-based managed security firm Trustwave for US$810m.
Trustwave chairman and CEO Robert McCullen, will retain a 2% interest in the company.
Further to the deal, which is due…
Singapore Telecommunications (Singtel) has agreed to acquire a 98% stake in US-based managed security firm Trustwave for US$810m.
Trustwave chairman and CEO Robert McCullen, will retain a 2% interest in the company.
Further to the deal, which is due to close in three to six months, Singtel will combine its information and communications technology (ICT) offering with Trustwave’s portfolio of managed security services.
“We aspire to be a global player in cyber security. We have established a strong security business in the region, both organically and through strategic partnerships with global technology leaders,” Singtel Group CEO Chua Sock Koong said.
Evercore advised Singtel on the deal, which is subject to regulatory approvals and other customary closing conditions.
The transaction is expected to be EBITDA positive from the second year of acquisition, and earnings accretive from the third year, Singtel said.
Chicago-based Trustwave is a privately-held provider of managed security services with three million business subscribers in 96 countries and five global security operations centers (SOCs) located in Chicago, Denver, Minneapolis, Manila and Warsaw.
As part of the agreement, Trustwave will continue to be led by its current management team and will operate as a standalone business.
The company received early-stage funding from FTV Capital, led by Richard Garman, managing partner and angel investor Dick Kiphart, a partner and senior advisor at investment firm William Blair.
Trustwave is looking to consolidate its position in North America and Europe, while working closely with Singtel to broaden its overall security portfolio and tap into the Asia Pacific security market.
The deal comes at a critical time for the managed security services industry, which is expected to increase to US$24bn in 2018, up almost 75% from US$14bn in 2014, according to the 2014 Gartner Information Security Forecast report, due to the increasing frequency and complexity of cyber-attacks.
Singtel, majority owned by Singaporean sovereign wealth fund Temasek Holdings, has moved to diversify from its core quad play offering in its domestic market. It has minority holdings in a number of regional operators, including India’s Bharti Airtel and Thailand’s Advanced Info Service PCL, and 100%-owns Australian operator Optus.
It has also has tech subsidiaries including a content portal, an IT engineering service company and a number of ISPs.
