SingTel buying US cyber security firm Trustwave for US$810m
Singapore Telecommunications (SingTel), Southeast Asia's largest telecommunications operator by revenue, is buying US-based cyber security firm Trustwave for US$810 million, marking its biggest acquisition outside its main sector.
Singapore Telecommunications (SingTel), Southeast Asia's largest telecommunications operator by revenue, is buying US-based cyber security firm Trustwave for US$810 million, marking its biggest acquisition outside its main sector.
The deal comes as SingTel is moving away from being a pure-play telecommunications company and pursues expansion in areas such as "digital life", which includes mobile video and digital advertising, and cyber security through partnerships with FireEye and Akamai, among others.
It also comes as the managed security services industry - which refers to the management of an IT system by a third party - is forecast to grow 15 per cent annually from 2014 to reach US$24 billion in 2018, according to IT consultancy Gartner.
"[The] acquisition of Trustwave is a critical step to capturing global opportunities in the cyber security market," SingTel chief executive Chua Sock Koong told reporters yesterday. Before this deal, SingTel spent about S$900 million (HK$5.14 billion) on acquisitions since 2012, mainly to build its digital life business.
SingTel will buy a 98 per cent equity stake in the company from a group of investors assembled by Trustwave's chairman and chief executive, Robert McCullen. He will hold the remaining 2 per cent.
Trustwave will continue to operate as a standalone business unit, SingTel said.
Trustwave, which has more than three million business subscribers, offers a range of services, including scanning of databases, risk identification and payment compliance. It reported revenue of US$216 million in 2014.
SingTel expects the deal, which will be funded through debt and cash, to be completed in three to six months. It forecast the transaction to add to earnings from the third year.
The Asian unit of US investment bank Evercore advised SingTel on the deal.
