Cognosec AB (publ) (“Cognosec” or “The Company”), (Nasdaq: COGS), a leading supplier of cyber security solutions with operations in Europe, Africa and the Middle East, has signed an exclusive agreement with A-tek Distribution, a UK-based company specialising in the sale and digital distribution via innovative portal technologies of cyber security solutions, products and services. The acquisition is in line with Cognosec’s strategy to expand business areas to cover the sale and distribution of software technologies over the internet.

 

This press release includes inside information of Cognosec AB (publ) (“Cognosec” or “The Company”) that has been subject to postponement of disclosure. The disclosure of inside information was postponed on December 8, 2016 under Article 17 (4) of Regulation (EU) No 596/2014 (Market Abuse Regulation).

 

Cognosec AB today announces the signing of Heads of Terms of Agreement pursuant to the acquisition of A-tek Distribution, which is expected to close in Q1, 2017 subject to legal, financial and technology due diligence exercises.

A-tek Distribution was founded in 2009, and is a United Kingdom registered company. The transaction will include the acquisition of 100% of outstanding shares for a consideration of approximately €275,000[1] comprised of €44,000 cash and €231,000 Cognosec AB new issue shares. The transaction will be completed by Cognosec AB subsidiary, Credence Security. There will be no other impact on Cognosec AB’s balance sheet.

 

A-tek Distribution is a specialist Digital Software Distribution Business, distributing cyber security solutions by portal and established by pioneers of digital software distribution who between them, possess over 85 man years of digital software distribution. A-tek is positioned as a New Age Distribution Business, enabling global access to the vast SME markets with Pay-as-you-Use and Software-as-a-Service cyber security solutions. The technology platform provides significant scalability and global advantages through innovative distribution methodologies.

 

A-tek Distribution recorded revenues of EUR101 510 2[2] in FY2016 and EBITDA of EUR 48 5602.

 

The acquisition of A-tek improves Cognosec’s competitive advantage for both vendors and customers alike. This addition also expands Credence Security’s current product portfolio to incorporate cyber security solutions for secure operation centers, network operation centers, datacenters, mobile platforms, virtualised environments as well as providing critical fraud prevention solutions into the technology, media, telecommunications, financial and public sectors.

 

Commenting on the acquisition of the business by Cognosec AB, Robert Hall, A-tek Distribution’s Co-founder, says that - “It will allow the Company to fast track the overview above, whilst working together with a globally recognised provider of cyber security excellence to secure additional distribution agreements giving our current and future partners tremendous platforms for future growth, productivity and profitability.”

 

Robert Brown, CEO of Cognosec AB commented – “We are delighted to broaden and deepen our business in line with our strategies through the acquisition of A-tek, a highly respected and experienced team. Through A-tek, Cognosec will be extending its customer base with the addition of web-based digital distribution portals covering existing and new segments of this growing market. Cognosec recognises the expansion of distribution of cyber security software through innovative portal solutions providing products and services with a strong emphasis on the SME markets as our strategic focus.”

 

[1]The transaction will complete in GBP so the approximation is for the GBP:EUR exchange rates which were taken at mid-market on 23rd January 2017, 1GBP=1.158EUR.

 

[2]A-tek Distribution Limited uses GBP as reporting currency. The approximation is for GBP:EUR exchange rates which were taken at mid-market on 23rd January 2017, 1GBP=1.158EUR.