DGAP-News: cyan AG / Key word(s): Takeover/Investment
cyan AG acquires majority stake in I-New Unified Solutions AG, significantly expanding its international reach to Mobile Virtual Network Operators (MVNOs)
- Financing of the purchase price from own funds and bank financing
- New Group expects to generate total revenues of at least EUR 35 million and EBITDA of at least EUR 20 million in 2019
Munich / 10 July 2018. cyan AG, a leading European provider of innovative white labeled IT security solutions for end customers of telecommunications providers (MNOs/MVNOs), banks and insurance companies as well as gaming and cryptocurrency platforms, is acquiring a 76.81 % stake in I-New Unified Mobile Solutions ("I-New"), a leading provider of technology and service solutions and MVNO platforms. I-New has 11 locations on 5 continents with around 40 Mobile Virtual Network Operators (MVNO) as clients, which serve around 5.5 million end customers. Clients of I-New include Virgin Mobile, with its activities in Colombia, Chile, Mexico and Peru, and Skinny in New Zealand. I-New offers those B2B-customers the full-service technology platform "from A to Z" to operate an MVNO, so that the respective partner can fully focus on his core competency of marketing, branding and acquisition of customers.
cyan is acquiring the shares from Austrian based Novomatic AG. The total volume of the transaction amounts to EUR 17.1 million, of which EUR 13.6 million amount for the acquired shares including taking over existing financing lines of banks. EUR 3.5 million will be paid via an earn-out model depending on earnings development of I-New in 2019, 2020 and 2021.
A binding purchase agreement was concluded today, which has already been approved by the Supervisory Board of cyan AG. Closing shall take place on 30 July 2018.
The purchase price is to be financed with the company's own, existing funds and by bank financing. Corresponding financing commitments have already been made by the banks.
cyan AG expects the transaction to have significant revenues and earnings effects as early as 2018 as well as significant synergy potentials, which are to be fully exploited within the next 24 months. In particular, through the acquisition of I-New, cyan will be able to significantly expand its international reach to MVNOs and should save up to two years relative to the alternative of gradual development of the market through its own customer acquisition activities.
Based on the combined revenue expectations, cyan expects at least EUR 20 million in pro forma revenues in 2018 and at least EUR 35 million in 2019. Overall, the Group aims to generate an EBITDA of at least EUR 7 million in 2018 and at least EUR 20 million in 2019 on a conservative forecast basis with only moderate synergy effects.
Cyan offers its customers comprehensive network security modules and products designed to optimize their mobile network. These solutions allow the MVNO to sell state-of-the-art cyber-security products to their customer base and significantly reduce required data volume, resulting in substantial cost savings. At the moment, cyan is working e.g. with Surf Telecom, the fastest growing MVNO in Brazil, and Flash Mobile in Mexico. An extensive technology partnership with I-New has already been in place.
In combination with I-New's expertise, cyan is now in a position to offer its clients services across the entire value chain: including platform solutions, data optimization and cyber security. In doing so, it has taken a major step towards becoming the leading global provider of integrated security and telecommunications solutions. cyan expects great potential in particular from the two companies' combined, highly efficient and globally positioned sales organization.
Peter Arnoth, CEO of cyan, said as follows: "We are very pleased that Novomatic has decided in favor of our offer. Since we already know I-New well as a technology and licensing partner and since that company has been one of our most promising cooperating partners in the past, we are aware of the immense potential of this merger. With the acquisition of I-New, our innovative cyber-security technology will now be used in all of I-New's 40 MVNO installations worldwide. At the same time, like us, I-New has a well-filled pipeline of potential new customers, so the combined group is poised for strong growth."
Michael Sieghart, CFO of cyan, stated as follows: "In the course of our existing business relationship, we quickly realized how much I-New's business model complements ours. I-New saves us two years of development work in operations, sales and global infrastructure. The synergy potential should be significant in the short and medium term. Our current guidance only contains this synergy potential very conservatively so far."
According to Markus Cserna, cyan's CTO: "I-New's technology is among the most advanced and efficient that can be found in the BSS/OSS sector. Combined with our innovative data optimization and security solutions, we should have even greater success together."
Harald Neumann, CEO of Novomatic, stated as follows: "We are pleased that I-New will remain in good hands after many years of development work and significant investments. Cyan convinced us of the quality of its concept for I-New and is also committed to the Austrian location. Furthermore, we can imagine a future collaboration in the field of cyber-security between Novomatic and cyan and are considering a cooperation in this area". ."
About cyan AG
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