Sydney cybersecurity provider Cipherpoint has sold its software division to Canberra-based security software provider ArchTIS for $ 1.4 million.
As part of the agreement, ArchTIS also acquired Cipherpoint’s European operations, including its office in Germany, existing contracts, sales and development staff, and the intellectual property of its software products, cp.Protect and cp .Discover. cp.Protect is a SharePoint on-premises data encryption solution, while cp.Discover is a data discovery and classification platform.
Cipherpoint said the move will focus on managed security services following its acquisition of Sydney-based Brace168 in January this year. The company will also resell cp.Protect and cp.Discover as part of its service offering.
âThis transaction is convincing. After the sale, Cipherpoint’s annual operating costs will be reduced by approximately $ 1,060,000 with a very modest impact on revenues. This significantly strengthens our cash position, âsaid Cipherpoint President Ted Pretty.
âCipherpoint will now focus on its managed security services business, including Brace168. Cash from the sale will be deployed to drive the growth of our managed services business, both organically and through potential acquisitions. “
Cipherpoint COO, Steven Bliim, will join ArchTIS as vice president of business development for EMEA, while Ted Pretty will step up to general manager while remaining chairman of the board.
ArchTIS said the acquisition complements its NC Protect software, adding data discovery and encryption technologies. The company is also expected to generate $ 370,000 in annual recurring revenue for ongoing contracts.
The price of $ 1.4 million also comes with additional consideration of up to $ 1 million payable based on the total value of contracts awarded to ArchTIS as of March 31, 2022.
ArchTIS COO Kurt Mueffelmann said, âWe have worked with the Cipherpoint software team for some time under our existing mutual reseller agreements. Buying assets is a logical next step in the relationship.
âThe targeted acquisition represents excellent value for ArchTIS shareholders with the delivery of many long-standing and high-profile customers and partners, as well as the expansion of markets in Europe and Singapore.
âIn particular, the asset purchases will provide ArchTIS with a unique data discovery and classification technology, complementary to NC Protect and capable of being cross-used with our existing technology stack. In addition, Cipherpoint’s industry-ready staff will easily integrate into our active offices in EU / America and strengthen our sales efforts in these markets. “