SYDNEY, AUSTRALIA: Spirit Technology Solutions (ASX:ST1), a leading provider of secure digital transformation and modern work environments, has announced the acquisition of InfoTrust, a Sydney-based cyber security company, for $34.6 million.
The deal, which is fully funded by a placement to a significant shareholder and an issue of Spirit shares, will scale Spirit’s cyber security division to become the largest business unit in the company and one of the larger cyber security businesses in Australia.
InfoTrust provides a range of cyber security services, including strategy, solution design, implementation, and support, via its CISO Services Retainer, which allows customers to leverage an entire cyber security team. The company has grown rapidly since its establishment in 2014 and now services a range of leading corporates.
Spirit expects to access security operations centre synergies of circa $1.4 million on an annualised basis and increase the margins of its existing cyber security division by implementing InfoTrust’s delivery approach. InfoTrust is forecast to deliver $4.4 million unaudited EBITDA in FY24 and has achieved an historic revenue CAGR of 39%.
InfoTrust’s co-founders Simon McKay and Dane Meah will join Spirit’s board following completion of the acquisition. McKay, who is also the chief executive officer of InfoTrust, is a well-regarded cyber security market expert with over 10 years’ experience in the sector, including roles with leading multinational software company, Symantec (now Gen Digital Inc.).
Headquartered in Sydney, InfoTrust also has offices in Melbourne, Brisbane and Manila. The acquisition expands Spirit’s geographic presence across Australia and adds significant growth and scale to its cyber security offering.
The issue of the scrip consideration and the shares under the placement are subject to shareholder approval, which will be sought at an EGM expected to be held in late March/early April 2024.
Spirit Managing Director and CEO Julian Challingsworth said: “We are thrilled to be expanding our presence in the growing cyber security market and to be strengthening our position in the major markets of Sydney and Melbourne via this acquisition.
Increasing both our cyber security and geographic spread was a logical next step for Spirit and InfoTrust provides us with a highly complementary product and services suite to our existing offering. The deal gives us ownership of a leading Australian cyber-security firm, a company that has strong sales growth and profitability, a well-regarded CEO and a diverse suite of well-established and loyal clients.
It delivers on our strategy of growth via acquisition and our overall goal of becoming one of Australia’s leading providers of modern and secure digital workplaces.”
Spirit was jointly advised by Unified Capital Partners (UCP) and Ord Minnett on the Placement. All Shares to be issued under the Placement will rank equally with the Company’s existing quoted shares on issue.
