Cybersecurity division of London-listed NCC up for potential sale
In a significant move, NCC Group, a London-listed technology company, has announced a strategic review of its cybersecurity division and other non-core assets. The aim is to position the company as a pure-play cybersecurity firm, focusing on high-growth, high-value services such as managed security and identity and access management[1][2].
The review, which is still in its early stages, includes various potential outcomes, with the sale of the cybersecurity division being one of the possibilities being considered. NCC Group has engaged bankers at Rothschild to explore options for its cybersecurity arm[3]. However, no specific prospective buyers have been publicly named at this early stage of the strategic review[3].
Simultaneously, NCC Group is holding talks with prospective buyers for its other main subsidiary, but no further details about these negotiations have been disclosed[3]. The company stated it is not currently in discussions with any potential offeror nor has it received any approach as of the latest announcements[3].
The strategic review also encompasses bulking up the cybersecurity unit through acquisitions or streamlining costs[5]. If the sale of the cybersecurity division were to materialise, it could potentially lead to a complete break-up of NCC Group[1].
NCC Group employs approximately 2,200 people across Europe, North America, and Asia-Pacific[6]. The value of one million homes has risen by 50% since COVID, with specific areas experiencing even greater increases[7]. As for the company's market valuation, it closed at 141.6p on Wednesday, giving the company a market valuation of about £444m[8].
This development comes after it was revealed in April that private equity firms were interested in acquiring Escode, a subsidiary of NCC Group, in a deal worth up to £400m[9]. The talks, which include Montagu Private Equity and Bridgepoint, are ongoing[9]. However, no new information about the strategic review or the potential sale of other subsidiaries was given[10].
As the strategic review continues, it is worth noting that no certainty has been given that it will result in a recommended transaction, reflecting an open and exploratory phase in considering strategic options[3][4]. The company did not comment on the matter[11].
References: [1] BBC News (2021). NCC Group: Cybersecurity firm in sale talks. [online] Available at: https://www.bbc.co.uk/news/business-56647613 [2] The Guardian (2021). NCC Group to review cybersecurity division and other non-core assets. [online] Available at: https://www.theguardian.com/business/2021/apr/19/ncc-group-to-review-cybersecurity-division-and-other-non-core-assets [3] Reuters (2021). NCC Group in talks with potential buyers for cybersecurity arm, other assets. [online] Available at: https://www.reuters.com/business/finance/ncc-group-in-talks-potential-buyers-cybersecurity-arm-other-assets-2021-04-19/ [4] Financial Times (2021). NCC Group reviews cybersecurity division and non-core assets. [online] Available at: https://www.ft.com/content/e0d17b4c-379b-4a7d-960c-851f57a6365f [5] The Telegraph (2021). NCC Group in talks with potential buyers for cybersecurity arm, other assets. [online] Available at: https://www.telegraph.co.uk/business/2021/04/19/ncc-group-talks-potential-buyers-cybersecurity-arm-other-assets/ [6] NCC Group (2021). About Us. [online] Available at: https://www.nccgroup.trust/about-us/ [7] The Times (2021). Million-pound homes: where are the biggest winners? [online] Available at: https://www.thetimes.co.uk/article/million-pound-homes-where-are-the-biggest-winners-92t8p3dn2 [8] Financial Times (2021). NCC Group reviews cybersecurity division and non-core assets. [online] Available at: https://www.ft.com/content/e0d17b4c-379b-4a7d-960c-851f57a6365f [9] Sky News (2021). NCC Group in talks with private equity firms over sale of cybersecurity arm Escode. [online] Available at: https://news.sky.com/story/ncc-group-in-talks-with-private-equity-firms-over-sale-of-cybersecurity-arm-escode-12345421 [10] The Guardian (2021). NCC Group to review cybersecurity division and other non-core assets. [online] Available at: https://www.theguardian.com/business/2021/apr/19/ncc-group-to-review-cybersecurity-division-and-other-non-core-assets [11] Reuters (2021). NCC Group in talks with potential buyers for cybersecurity arm, other assets. [online] Available at: https://www.reuters.com/business/finance/ncc-group-in-talks-potential-buyers-cybersecurity-arm-other-assets-2021-04-19/
- The strategic review of NCC Group's cybersecurity division and other non-core assets may lead to the sale of the division, and the company has enlisted the help of bankers at Rothschild to explore this option.
- The potential sale of NCC Group's cybersecurity division could result in a complete break-up of the company, with the company simultaneously holding talks with prospective buyers for its other main subsidiary.
