REG - Crossword Cybersec - Proposed Acquisition and Trading Update

Crossword CybersecurityAnnouncement

21/12/2021 07:00

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RNS Number : 2645W  Crossword Cybersecurity PLC  21 December 2021

Crossword Cybersecurity plc

 

Proposed acquisition of cyber threat company to bring Crossword's product
portfolio to five offerings

 

Trading update

 

 

21 December 2021 - London, UK - Crossword Cybersecurity Plc
(http://www.crosswordcybersecurity.com/) (AIM:CCS, "Crossword", the "Company"
or the "Group"), the technology commercialisation company focused on cyber
security and risk management, today announces that it 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 has agreed, subject to contract, to pay a total consideration of
£1,529k 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 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 ("Stega") (https://www.stega.com/) , 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."

- Ends -

The information contained within this announcement is deemed to constitute
inside information as stipulated under the retained EU law version of the
Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK
law by virtue of the European Union (Withdrawal) Act 2018. The information is
disclosed in accordance with the Company's obligations under Article 17 of the
UK MAR. Upon the publication of this announcement, this inside information is
now considered to be in the public domain.

 

 

Contacts

Crossword Cybersecurity plc - Tel: +44 (0) 20 3953 8460

Email: info@crosswordcybersecurity.com

Tom Ilube, Chief Executive Officer

Mary Dowd, Chief Financial Officer

 

Grant Thornton (Nominated Adviser) - Tel: +44 (0) 20 7383 5100

Colin Aaronson / Daphne Zhang

 

Hybridan LLP (Broker) - Tel: +44 (0)203 764 2341

Claire Louise Noyce

 

For media enquiries contact:

Lorena Duke, GingerPR

crossword@gingerpr.co.uk (mailto:Crossword@gingerpr.co.uk) - Tel: +44 (0)1932
485 300

 

About Crossword Cybersecurity plc

Crossword Cybersecurity (https://www.crosswordcybersecurity.com/) plc focuses
on the development and commercialisation of university research-based cyber
security and risk management related software and cyber security consulting.
The Group's specialist cyber security product development and software
engineering teams work with its university partners to develop the research
concept into a fully-fledged commercial product that it will then take to
market. The Group's aim is to build up a portfolio of revenue generating,
intellectual property based, cyber security products. Rizikon Assurance
(https://www.rizikon.io/) , Crossword's leading product, is a SaaS platform
that enables medium to large companies to assess and manage all risks from
their suppliers. Nixer CyberML, another Crossword product, is a new tool for
businesses that want to solve advanced security and cybercrime problems, such
as detecting and dealing with compromised accounts, fraud, and in-application
denial of service attacks.  Identiproof, Crossword's most recent product, is
the World Wide Web Consortium (W3C) verifiable credentials compatible
middleware and wallet technology. Crossword's team of expert cyber security
consultants leverages years of experience in national security, defence and
commercial cyber intelligence and operations to provide bespoke advice
tailored to its clients' business needs, including threat monitoring.

 

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