Accumuli Plc Acquires Signify Solutions Limited

Posted: 13th June 2013 08:35

Accumuli plc (AIM:ACM), the independent specialist in IT security, is pleased to announce that it has acquired the entire issued share capital of Signify Solutions Limited ("Signify"), a managed service IT security provider, for net cash consideration of £2.6 million.
  • Signify is the UK's leading provider of managed service Two-Factor Authentication ("2FA"), utilising both RSA technology (public key cryptography algorithm) and its own Passcode OnDemand software to enable secure remote access to an organisation's network
  • Consideration paid £4.2m, £2.6m net of cash in the business at completion
  • Provides a significant increase  in the Group's recurring revenues and a 250 strong customer base into which Accumuli can cross sell its portfolio of solutions  and services
  • Acquisition in line with Accumuli's stated strategy of acquiring businesses which complement the Group's existing expertise and capabilities
Gavin Lyons, Chief Executive of Accumuli, commented: 

"Signify is a business with a long and successful history in the provision of 2FA managed services; they have an outstanding reputation for delivering a secure, reliable and flexible solution.The 2FA managed security offering complements Accumuli's market leading security portfolio and we now have the opportunity to provide additional solutions and services to Signify's existing 250 customers.
"Given the growing mobility of today's workforce, it is becoming increasingly important for all organisations to secure  remote access to systems and information. Adding 2FA managed services to our established portfolio of IT security solutions represents the next logical step in our value proposition to help customers secure their business and reduce operating costs. We look forward to welcoming the employees of Signify into the Accumuli Group so that they can continue to deliver exceptional service. "
Signify is a leading provider of managed service 2FA based on RSA technology and its own Passcode OnDemand software.
2FA is used as a secure alternative to passwords to enable remote access to an organisation's systems and information.  It is a more secure alternative than simple passwords (single factor), which can be compromised by any number of tactics.  2FA relies upon something you know, typically a PIN number or password, and something you have, typically a token (key fob) or mobile phone, to provide log on credentials.  This is a common method deployed by large organisations, but also now smaller ones, as part of an overall IT security policy.
Signify has, over 13 years, built a market leading 2FA managed service offering based on the following benefits to its customers:
  • Guaranteed reliability with an SLA (Service Level Agreement) backed service;
  • ISO27001 accredited and market leading, proven technology;
  • Customer-tailored and flexible offering with variable contract lengths and user numbers with token and token-less services; and
  • Reduction of management costs for 2FA as products are compatible with all leading firewalls, web servers and VPNs, plus Signify provides a self- service management portal and handles distribution of tokens.
Signify has a customer base of over 250 end customers spread across a range of industries, geographies and sizes.  A majority of its business comes through partners and resellers, although uniquely it maintains a relationship with the end customer in these instances through its customer service offering.  The high level of service it offers is borne out by renewal rates for its services, where Signify experiences only a very low level of customer churn. 
Accumuli anticipates that it will obtain cross selling synergies through promoting its portfolio of IT Security products and services to what it believes will be a receptive audience of end customers and partners.
In the financial year ended 31 March 2013 Signify generated £0.56 million EBITDA (Earnings before interest, tax and depreciation) on revenues of £2.9 million and gross profit of £2.3 million. Signify employs 23 people at its offices in Histon, Cambridge.  The managed service nature of the business means that 77% of its revenues, and 88% of its gross profit is attributable to recurring revenues.
Dave Abraham, CEO and significant shareholder of Signify, will remain with the business on a consultancy basis to assist with the transition.  All remaining executive and operational management of the business will remain in place post completion.
The total consideration paid by Accumuli was £4.2 million in cash for the entire issued share capital of Signify.  At completion there was £1.6 million in cash in Signify, which means the net price paid by Accumuli was £2.6m.

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