TIDMACM
RNS Number : 2505A
Accumuli PLC
19 December 2014
19 December 2014
Accumuli Plc
("Accumuli" or the "Group")
Acquisition of RandomStorm Limited ("RandomStorm")
Accumuli enhances its solutions and services framework with the
addition of RandomStorm, a renowned integrated information security
specialist that helps organisations to manage IT risk and implement
security best practice using its own intellectual property and
services.
RandomStorm have developed award winning solutions for
vulnerability management and network security along with security
services including penetration testing, social engineering, PCI
compliance and ISO audit assessments.
Accumuli plc (AIM:ACM), the independent specialist in IT
security and risk management, is pleased to announce that it has
acquired the entire issued share capital of RandomStorm Limited
("RandomStorm") for net cash consideration of GBP8.9m which is
being funded through a combination of existing cash resources and
new bank debt secured on competitive terms ("the Acquisition").
RandomStorm is a UK based integrated information security
specialist. It uses its own intellectual property ("IP") and
services to turn security data into security intelligence in
addition to helping to simplify and automate regulatory compliance
processes in order to provide peace of mind for network managers
that their IT environment is fully protected.
Highlights
-- Acquisition of RandomStorm for consideration of GBP8.9m
o Existing owner managers have agreed to provide consultancy
services to the Group for 12 months from completion to ensure
managed transition
-- RandomStorm has developed substantial intellectual property
which provides scalable managed network security services to
enterprise level customers
-- Combination of RandomStorm and Accumuli creates an operation
of significant scale, skills and capability unique to the UK IT
security market
-- Acquisition provides substantial skills, expertise and
revenues to Accumuli's "Prepare" practice in addition to providing
opportunities to further develop Accumuli's 'Customer Intimacy'
initiative to drive cross selling
-- Acquisition in line with Accumuli's stated strategy of
acquiring businesses which complement the Group's existing
expertise and capabilities or extend its solution and services
framework
Gavin Lyons, Chief Executive of Accumuli, commented:
"RandomStorm is a business which has excelled in providing
market leading integrated information security solutions and
services to help its customers manage IT risk and implement
security best practice. Their expertise and experience in IP
creation and security services will add tremendous value to our
business and our customer intimacy strategy.
"As a business we remain focused on helping our customers manage
IT risk and leverage their IT assets - we are particularly excited
about utilising the IP that has been created and combining
vulnerability management, penetration testing, compliance and audit
services with our 24x7x365 Security Operation Centre to offer our
customers a true end-to-end managed service.
"The close proximity of the RandomStorm business to our existing
Leeds office provides a significant opportunity to create a
substantial base in the Leeds area which will be capable of
accommodating all current staff of both businesses and attracting
and retaining future talent."
RandomStorm
RandomStorm is a UK based network security, vulnerability
management and compliance company, focused on providing
enterprise-level, proactive security management products and
services.
RandomStorm was formed in 2007 by Andrew Mason and Robin Hill,
who have a combined track record of success in the IT Security
industry of almost 40 years. Andrew was formerly a director and
shareholder in Boxing Orange Limited (a company Accumuli acquired
in 2011), and the technical force behind that business before
leaving (and selling his shareholding) in 2006. Robin was
previously the sales director for Webscreen Systems Limited, again
before leaving in 2007 to establish RandomStorm.
The business initially focussed on vulnerability assessments and
compliance services around Payment Card Industry Data Security
Standards ("PCI DSS"), vulnerability scanning and penetration
testing. However, through the technical lead provided by Andrew and
a dedicated team of developers they have subsequently built a suite
of proprietary systems which are situated on customer site and
allow for RandomStorm to deliver managed network security services.
The products are branded and include StormAgent (which was highly
commended in the 2014 UK IT Security Awards and is a Log Management
and File Integrity solution which simplifies and accelerates
Network Threat Discovery), StormProbe, iStorm, xStorm, AirStorm and
WebStorm.
RandomStorm has provided services to over 500 organisations
since inception and its current sales strategy is predicated on
assisting customers identify IT security risks within their
infrastructure and environment and then providing cost effective
solutions which can monitor and manage the risks identified. As the
products being used are proprietary, the costs of additional
managed services are minimal and simply entail 'turning on' the
feature and some initial benchmarking.
The increasing compliance requirements for companies,
particularly around areas such as PCI DSS, continue to provide
strong external growth factors and RandomStorm is well placed to
benefit from this expansion in the market. Additionally, Accumuli
has been looking to acquire a business with an established presence
in what can best be described as the "Prepare" phase of IT Security
'Readiness'. There are a number of recognised governmental
frameworks in the US and UK which seek to establish a formal,
staged approach to IT Security Readiness and these broadly break
down into four areas; Prepare, Protect , Monitor and Respond.
Accumuli's business to date has been strong on Protect and Monitor
but less well developed in the Prepare area, and the Acquisition
provides a strong entry point into this important area.
RandomStorm's unaudited results for the year ended 30 April 2014
showed revenues of GBP3.5m, EBITDA of GBP1.0m, gross assets of
GBP2.0m and net assets of GBP0.7m. In the five months to 30
September 2014 (unaudited) RandomStorm generated revenues of
GBP1.8m and EBITDA of GBP0.4m, which was after continued investment
in sales and technical resources. Approximately 65% of revenues
originate from consulting activities and the remainder relate to
managed services linked to RandomStorm's own proprietary products.
The nature of the services that RandomStorm sells means that gross
profit margin exceeds 95% (as own consultant costs are treated as
overheads) and historically there has been a substantial element
(70%) of repeat purchases. RandomStorm employs 57 people across its
main site in Wetherby, sales offices in London and Glasgow and a
development team based in Thorpe Park, Leeds. Andrew Mason and
Robin Hill have agreed to remain with the business for 12 months
after completion to manage the transition to Accumuli and will
continue to provide sales and technical leadership to the
business.
Consideration
The total consideration payable by Accumuli is GBP10.0m in cash
for the entire issued share capital of RandomStorm. At completion
there was GBP1.1m in cash in the company, which means the net price
payable by Accumuli on completion is GBP8.9m. This has been funded
from Accumuli's own cash resources and through securing a GBP10m
debt facility with the Group's bank, 50% of which is on a 5 year
term loan and 50% of which is on a revolving credit facility.
For further information, please contact:
Accumuli plc Tel: +44 (0)1256 303700
Gavin Lyons, CEO
Ian Winn, Finance Director
finnCap Tel: +44 (0)20 7220 0500
Charlotte Stranner/Christopher
Raggett (Corporate Finance)
Victoria Bates (Corporate Broking)
MXC Capital Advisory LLP Tel: +44 (0)20 7801 9596
Marc Young
Charles Vivian
Newgate Threadneedle Tel: +44 (0)20 7653 9850
Hilary Buchanan
Jasper Randall
About Accumuli
Accumuli is a leading, rapidly growing, UK based independent
specialist in IT security and risk management. We provide industry
leading solutions and services underpinned by rare skills and
capabilities. Our objective is to enable organisations to manage
the ever increasing IT risk landscape and leverage their IT assets
for business value.
Managing risk created from significant IT Trends (such as
cybercrime, consumerisation of IT, Big Data) or business objectives
(such as saving money or doing more with less) is the perennial
balancing act for any IT department. The ideal outcome is to have
an IT infrastructure that is available, performing and visible
whilst always being compliant, resourced and secure.
The Accumuli approach is to assist our customers in identifying
both the risk and potential of their IT infrastructure and address
any gaps with leading solutions and expert services. Accumuli has a
culture that is focused entirely on helping our customers and
working as one team to deliver tangible results - we can help with
a very specific need or a holistic end-to-end solution.
Accumuli is a public company quoted on the AIM market of the
London Stock Exchange with offices in Basingstoke, Cambridge and
Leeds. Accumuli's global customer base consists of companies of all
sizes across an expanding range of industry sectors including
financial services, utilities, telecommunications, manufacturing
and government.
Accumuli Security
Managing IT Risk | Leveraging IT Assets
This information is provided by RNS
The company news service from the London Stock Exchange
END
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