Singtel to acquire US cyber security firm Trustwave for $810mn
08 April 2015
Southeast Asia's largest telecom operator Singapore Telecommunications Ltd (Singtel) has agreed to buy Trustwave, the largest independent managed security services provider in North America, for approximately $810 million, aiming to become a global player in the sector.
Under the terms, Singtel will acquire 98-per cent stake in Trustwave, excluding debt, while Trustwave chairman and CEO Robert McCullen will hold the remaining 2 per cent.
Commenting on the deal, Singtel Group CEO Chua Sock Koong said: ''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.''
Chicago-based Trustwave provides its services in three basic areas, including threat management, vulnerability management and compliance management in the markets of North America, Europe and Asia Pacific.
The services delivered through its cloud-based platform TrustKeeper help customers protect their IT infrastructure, applications and networks and respond to cyber threats.
''Our extensive customer reach and strong suite of ICT services, together with Trustwave's deep cyber security capabilities, will create a powerful combination and allow Singtel to capture global opportunities in the cyber security space,'' Koong said.
Trustwave has around 1,200 employees in 26 countries, including an elite team of security experts in its forensic and threat research security unit SpiderLabs, serving over three million customers worldwide.
The acquisition will expand Singtel's existing portfolio of cloud based solutions and further entrench its leadership position in the managed services market.
Singtel said it "will leverage Trustwave's threat intelligence, technology and talent to meet the growing demand for always-on managed security services in North America and the Asia-Pacific region".
Post acquisition, Trustwave will continue to operate as a standalone unit and expand its business in the fast growing emergency security market in the Asia Pacific region.
Robert McCullen, said: ''This strategic partnership creates an unparalleled opportunity to combine Singtel's robust information and communications solutions with Trustwave's industry leading security technologies and managed services platform to deliver cutting edge solutions.''
''Singtel is the perfect partner for us as we continue to help businesses fight cybercrime, protect data and reduce security risk. The Trustwave team is thrilled to become a part of such a prestigious and innovative organization,'' he added.
The transaction is expected to close in three to six months, subject to regulatory approvals and certain other conditions.
The acquisition will be accretive to Singtel's earnings from the third year of closing, according to the company.
The increasing dependency upon information technology and network systems in recent years has incited growing cyber security threats to enterprises and organizations.
According to Gartner market research, the managed security services industry is expected to grow at a rapid rate of 15 per cent annually in four years from $14 billion in 2014 to reach $24 billion in 2018.
Singtel, the largest company by market capitalisation listed on the Singapore stock exchange, is owned by Temasek Holdings, the investment arm of the Singapore government. It has aggressively expanded outside its home market by acquiring stakes in regional operators including 100 per cent in Australia's second-largest telco Optus and about 31 per cent in Airtel, India's largest mobile operator.
Singtel's combined subscriber including its partners in 25 countries stand at around 500 million.