Singapore Telecommunications (Singtel), said on Tuesday that it has entered into a definitive agreement to acquire Chicago-based data security and compliance solutions firm Trustwave or $810 million in cash.
Following the close of the acquisition, Trustwave will operate as a standalone Singtel business unit and continue to be headquartered in Chicago, the company said.
In an effort to boost its cyber security capabilities, Singtel said it plans to combine its information and communications technology (ICT) with Trustwave’s portfolio of managed security services.
While Kirkland & Ellis, who advised Trustwave on the deal, said the company has an enterprise value of $850 million, the aggregate consideration for the transaction is approximately $810 million, excluding net debt, and is subject to working capital adjustments at closing, according to documents filed by Singtel.
Following the close of the transaction, Singtel will own a 98% equity stake in the firm while Robert J. McCullen, Chairman, CEO & President at Trustwave, will hold on to a 2% equity interest, according to the documents.
In 2011, Trustwave filed papers with the SEC with plans for an Initial Public Offering (IPO) which was later shelved.
Trustwave will bring cybersecurity assets and capabilities to Singtel including:
• More than three million business subscribers in 96 countries
• More than 1,200 security-focused employees located in 26 different countries
• Five global security operations centers (SOCs) located in Chicago, Denver, Minneapolis, Manila and Warsaw
• Trustwave SpiderLabs ethical hacking and threat research team
• A portfolio of security technologies and intellectual property with more than 56 patents either granted or pending
• The unified, cloud-based TrustKeeper portal which is used to deliver Trustwave security and compliance services
“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,” said Chua Sock Koong, Singtel Group CEO.
“Singtel is the perfect partner for us as we continue to expand and grow our business, and we’re thrilled to become a part of such a prestigious and innovative organization,” McCullen wrote in a blog post.
The acquisition is subject to regulatory approvals and other customary closing conditions.
The Trustwave management team will continue to operate the business unit, and McCullen said he would remain in his role as Chief Executive Officer and President.
The move to acquire Trustwave is the latest effort from Singtel to expand its cybersecurity offerings.
In late 2014, SingTel and FireEye announced a partnership to offer FireEye’s technology to SingTel customers in the cyber Asia Pacific (APAC) region. Under the partnership, security operation centers will be launched in Singapore and Australia, along with a SingTel managed defense solution powered by FireEye that will provide continuous monitoring, threat detection and mitigation to enterprises and government customers, along with threat protection for mobile devices.
*Updated with value of transaction