Manchester cyber security company, NCC Group, has sold its Netherlands-based crypto operation.
It will receive £66m in cash from CR Group Nordic AB for Fox Crypto BV. The deal is expected to be completed by October.
Fox Crypto’s revenues were £18m in the last financial year, with profits of £4m, which means the sale represents a 2024 EBITDA of 16.5x.
NCC Group stated that it was previously a standalone entity and the sale “will not impact the Group’s continuing Cyber capabilities.”
As of 31st May 2024, NCC Group’s debt was £38.5m and the expected net proceeds of £62m will not only clear this but lead to “organic and inorganic growth in the Group’s Cyber Security business.”
In a statement to the Stock Exchange it added that the disposal “represents a continuation of the Group’s transformation strategy to simplify the business and create a more focused Cyber Security business. Both our Cyber and Escode businesses provide the benefit of a portfolio effect to the overall Group performance with clear future growth opportunities to enhance shareholder value.”
The announcement came after it released its unaudited results for the year to 31st May.
This showed that revenue for 2024 was down to £324.4m (2023: £335.1m), this was due to its Cyber Security division, which saw income fall 4.5%. Its Escode operations had revenue growth of 2.5%.
“The Group’s transformation journey is progressing well and is already delivering results; however, work continues,” said Mike Maddison, Chief Executive Officer.
“We have enhanced our capabilities in Cyber and diversified our routes to market, developed differentiated brands and implemented a global resourcing and scheduling model enabled by a new delivery and operating centre. We have made this strategic progress whilst successfully reducing our operating costs and improving our gross margin. In addition, we have delivered continued quarter-on-quarter growth of Escode. This could not have been achieved without the focus and resilience of our excellent management team and all our dedicated colleagues”.
