Crossword Cybersecurity PLC (AIM:CCS) has signed heads of terms to acquire a hacking threat company to expand the spread of its product portfolio.
AIM-listed Crossword will pay £1.53mln for the cyber threat specialist, which it did not name, via a mixture of cash and shares.
The acquisition brings with it around twenty new clients across various sectors in multiple jurisdictions, Crossword added, with the new company currently running at breakeven, with 90% recurring revenue.
A final acquisition agreement is expected to be signed in early 2022.
Once completed, the acquisition will be Crossword's third in less than 12 months and fulfils its aim of having a portfolio of five products by the end of 2022, it said.
The portfolio now comprises Verifiable Credentials and its Identiproof platform, Rizikon, Nixer and Stega, which was acquired in August.
Crossword added it is now marketing Identiproof and is currently shortlisted for a major public sector tender opportunity.
Discussions are also underway with several commercial businesses on how they might use the Identiproof platform to issue verifiable digital certificates in areas such as digital ticket sales (festivals, concerts, exhibitions), insurance, compliance certificates (standards, accreditations) and education.
In a trading update alongside the news of the acquisition, Crossword said revenue growth in 2021 is expected to be over 40%, which is at the lower end of market expectations but it remained confident that 2022 will see revenue growth accelerate.
Tom Ilube, chief executive, added: "We are delighted to have the opportunity to acquire this fast-growth company, and to complete our objective of having five cyber security SaaS products in our portfolio almost a year ahead of schedule.”