Singapore Telecommunications will buy a 98 per cent stake in Trustwave Holdings for $810 million (€748m) as Southeast Asia's biggest phone company seeks to expand in cyber security. The deal gives the company control of businesses in North America, Europe and the Asia Pacific region and is expected to add to earnings from the third year, Singtel said.
It will be the Singapore-based company’s biggest acquisition since the 2001 takeover of Australia’s Optus for $9.69 billion, according to data from Bloomberg.
Singtel is seeking new expansion as growth in its home market of Singapore slows and the company relies more on dividends from investments in emerging-market carriers including India's Bharti Airtel. The company acquired Amobee in 2012 to add mobile advertising and last year bought digital marketing and content businesses Adconion and Kontera Technologies. "I would characterize this as more of an investment" than an acquisition designed to integrate with Singtel's other businesses, Sachin Mittal, an analyst at DBS Bank in Singapore said. "This is an exciting space – the question is, is this the winning horse?" Chicago-based Trustwave had net tangible liabilities of about $84 million and more than 3 million business subscribers, it said.
Trustwave has only about 1.5 per cent of the cyber security market and its advantages against larger competitors weren’t immediately clear, Mittal said. Shares of Singtel fell 0.9 per cent to S$4.38 at the close of trade in Singapore, paring this year’s gain to 12 per cent. – (Bloomberg)
