JSE-listed security software company SecureData and a management consortium are selling a UK business for £16.6 million - or about R207.5 million - to a recently-created special purpose vehicle.
SecureData owns 80.8% of the SecureData Europe unit, while the balance is held by management members, including Etienne Greeff, Matthew Tomlinson and interim CEO Johan du Toit.
SecureData UK is the holding company of SecureData Europe and has almost 20 years' experience in providing companies with bespoke IT security solutions.
“After 19 years of supplying security advice, services and technology, SecureData Europe is the longest standing IT security-specific organisation in the UK and has provided numerous secure solution deployments across Europe and the US,” says SecureData in a statement.
SecureData Europe was bought as part of the listed group's plan to “become a meaningful provider of information risk management solutions and products within Europe, the Middle East and Africa”, it says.
The deal was approved on the understanding that, despite SecureData's former CEO, Dean Brazier, relocating to the UK, the entity's African operations would remain management's primary focus.
SecureData Europe, which performed better than expected, will be sold so that SecureData can focus on its flagging African operations, it says. The sale will help the group to settle debt and provide a cash injection for its Africa unit.
In the six months to January, SecureData Europe posted a 44.3% increase in revenue and a 51.9% improvement in operating profit based on UK currency. Despite the gains, SecureData says a lack of focus on the African operations led to a significant reduction in profitability for the group.
Selling the unit will weigh on basic and headline earnings per share, which are expected to decline 106%.
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