Singtel May Sell TrustWave MSSP, Cybersecurity Business
Related Update – May 31, 2021: Singtel provides more clues about Trustwave ownership direction.
In a prepared mid-May 2021 statement about the potential sale of Trustwave, Signtel Group CEO Yuen Kuan Moon said:
“We need to focus our strategic agenda. Both businesses have come under increasing pressure in the last two years due to industry and operational challenges. The COVID-19 pandemic has also impacted performance, with enterprises and advertisers tightening their belts as economies went into lockdown. Amobee saw an almost year-long contraction in advertising spend by some of the largest agencies and advertisers in North America. Against this backdrop, there is a clear need to review these major investments to identify ways to increase the probability of successful execution.”
“This review could involve the restructuring of product or business segments, a full or partial divestment or business combinations with other industry players. We are open to all types of strategic partnerships and deals including inviting investors who have complementary capabilities and can enhance the value of the businesses. Cyber security remains core to our Group strategy and ICT offerings, and the review will be geared to ensure we capture the growth in Asia Pacific.”
Trustwave’s MSSP Business: Key Cybersecurity Services
Singtel acquired Trustwave for $770 million in 2015. The MSSP offers threat hunting, security technology management and other managed security services.
On the executive front, Trustwave hired HP and DXC veteran Eric Harmon in November 2020 to succeed Art Wong.
Trustwave Under Pressure, But MSSP M&A Is Strong
Fast forward to May 2021. Although the MSSP market is growing rapidly, Singtel appears to be signaling that Trustwave’s business is under pressure.
Indeed, Singtel has booked non-cash impairment charges of US$250 million against the Trustwave investment for the second half of the financial year ended 31 March 2021.
“The move comes amid rapid shifts in the fast-moving digital marketing and cyber security industries and economic shocks resulting from COVID-19 that have impacted both businesses’ ability to scale,” Singtel indicated.
On a positive note: Singtel is exploring a potential Trustwave business sale amid strong M&A and investor demand for MSSPs. Recent buyers and investors in the MSSP market include Accenture, private equity firm Apax Partners, Atos and Wipro, among many others.