archTIS Ltd (ASX:AR9, OTCQB:ARHLF) has struck a deal to acquire the assets of US data security software provider Spirion LLC, a move the company says will materially expand its North American presence and boost its annual recurring revenue base.
The A$15.7 million transaction — priced at 0.9 times Spirion’s FY25 annual recurring revenue (ARR) — will lift archTIS’ pro-forma ARR to A$21.8 million. Spirion generated A$17 million in FY25 revenue and serves more than 150 enterprise, government and education clients.
The acquisition builds on a significant contract win the company announced in June for the sale of its NC Protect Software to a US Department of Defense contractor, further strengthening its foothold in the American defence and enterprise security market.
Read more: Strategic defence growth fuels recurring revenue and customer expansion for archTIS
Expanding scale and reach
archTIS chief executive and managing director Daniel Lai said the acquisition marked the culmination of a strategic push into the United States.
“As we have previously communicated to the market, we have been undertaking a strategic initiative to identify and close a transformational acquisition in the US that brings us scale and expanded market opportunity,” Lai said.
“By combining archTIS’ award-winning products with Spirion’s industry-leading data discovery and classification capabilities, we are creating a comprehensive, Zero Trust data-centric security platform to protect our clients,” he added. “We welcome Spirion’s talented team, whose expertise will accelerate our expansion and execution in the US market.”
The deal will also bring across 38 Spirion employees, including senior executives and technical specialists. Spirion’s chief executive, Kevin Coppins, will join archTIS as executive vice president of a newly created commercial enterprise solutions division.
“Joining archTIS is a strategic next step for Spirion’s employees and our customers,” Coppins said. “The combination creates a scaled, global leader in data-centric security with the proven technology, recurring revenue base and talent required to accelerate growth.”
Cross-sell and synergy opportunities
archTIS expects the acquisition to broaden its US market channels and diversify its client mix, with Spirion’s blue-chip customer base offering immediate cross-selling opportunities.
Spirion specialises in sensitive data discovery, classification and remediation, particularly for privacy and compliance, while archTIS is best known for its attribute-based access control (ABAC) technologies. Integrating the two platforms will enable a more comprehensive suite of governance and compliance solutions across Microsoft 365, SharePoint and other file-sharing environments.
“Building on archTIS’ recent US Department of Defense contract win, this combination gives the company the proven technology, talent, and customer base to expand and scale our US operations rapidly,” Lai said. “We now have solutions that can protect sensitive information from the boardroom to the battlefield.”
Funded through placement and entitlement offer
To fund the acquisition and related initiatives, archTIS is raising about A$20.5 million. The package includes a A$3.5 million placement to institutional investors and a fully underwritten 1-for-3 non-renounceable entitlement offer to raise about A$17 million.
Shares under both components will be issued at A$0.15 each — an 18.9% discount to the company’s August 25 closing price of A$0.185 and a 25.2% discount to the seven-day volume-weighted average price (VWAP).
Proceeds will be used not only for the acquisition but also staff retention, integration costs, product development and growth initiatives.
Henslow Pty Ltd and Canaccord Genuity (Australia) are acting as joint lead managers and underwriters for the placement and entitlement offer, which opens on September 2 and closes on September 11, with new shares expected to be issued from September 18.