LONDON, UK: Crossword Cybersecurity Plc has signed heads of terms to acquire a cyber threat company which, on completion, would bring its portfolio to five cyber security offerings alongside its cyber security consulting business.
Crossword will now focus its full attention on marketing and selling its product portfolio and consulting services to scale up the business.
Crossword Cybersecurity has agreed, subject to contract, to pay a total consideration of £1.529 million for the cyber threat company, in a mixture of cash and shares, some upfront and some deferred.
This price represents an annual recurring revenue multiple of 5.25. The acquisition brings additional SaaS products which provide clients with high value cyber security insight at an affordable cost. It will bring circa twenty new clients to Crossword, across various sectors in multiple jurisdictions.
The target company is reaching breakeven, with 90% recurring revenue. Cross sell opportunities will be explored with the acquisition, alongside operating synergies. A further announcement will be released once the acquisition agreement has been signed which is expected early 2022.
This pending acquisition will be Crossword’s third acquisition in less than 12 months and achieves our stated aim of having a portfolio of five products by the end of 2022.
Verifiable Credentials Limited was acquired in May 2021 and its product, Identiproof, increased Crossword’s software product portfolio to three alongside Rizikon and Nixer. Crossword is now actively taking Identiproof to market and is currently shortlisted for a major public sector tender opportunity associated with the Identiproof platform.
Crossword Cybersecurity is also in discussions with several commercial businesses on how they might use the Identiproof platform to issue verifiable digital certificates, as there is a shift from physical certificates to digital credentials across sectors ranging from digital ticket sales (festivals, concerts, exhibitions), insurance, compliance certificates (standards, accreditations), education and many more.
In August 2021, subsequent to it’s oversubscribed £5.0m fundraising, Crossword completed the acquisition of the whole of the share capital of Stega UK Limited, the threat intelligence and monitoring company. The integration of Stega into Crossword is going well, with many cross-sell opportunities identified. On the back of a successful 2021, with revenue growth achieved expected to be over 40%, at the lower end of market expectations, Crossword is confident that 2022 will see revenue growth accelerate.
Tom Ilube CBE, CEO at Crossword Cybersecurity PLC, said: “We are delighted to have the opportunity to acquire this fast growth company, and to complete our objective of having five cyber security SaaS products in our portfolio almost a year ahead of schedule. The second half of 2021 continued to see excellent client traction with Rizikon, and we are ending the year with more than 500 users of our leading product. With our product portfolio in place, we can now focus our full attention on marketing and selling our SaaS products and consulting services to scale up the business.”