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Temasek to acquire StarHub's cryptographic tech firm D'Crypt

TEMASEK Holdings has agreed to stump up as much as S$100 million to acquire cryptographic tech firm D'Crypt from StarHub and D'Crypt's founding shareholders.

StarHub and the founding shareholders - Dr Antony Ng, Chew Hwee Boon and Dr Pang Liang Teck - will sell their 100 per cent stake in D'Crypt to Temasek for an initial aggregate cash consideration of S$100 million.

Of that sum, StarHub will receive S$65 million for its 65 per cent stake in D'Crypt.

But the founding shareholders stand to receive an additional earn-out consideration of up to S$33.6 million, if they achieve certain agreed business and performance milestones.

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As part of the transaction, Ensign InfoSecurity - StarHub's joint venture with Temasek - will be issued preference shares and be fully entitled to the economic rights of D'Crypt. Following the transaction, StarHub will hold 60 per cent of the economic interest in D'Crypt through its shareholding and interest in Ensign.

The transaction is expected to be completed by November this year.

StarHub had acquired D'Crypt for some S$122 million in 2017, and added the firm to its fledgling cybersecurity unit, which recently turned in second-quarter operating loss of S$900,000 in the period, against a profit of S$4.1 million in the year-ago period.

Yeoh Keat Chuan, Ensign's CEO, said: "The acquisition of D'Crypt will provide Ensign with world-class engineering and cryptographic capabilities. This will enhance its ability to provide advanced cybersecurity solutions to secure enterprises and sectors against advanced threats in today's digital economy. In parallel, D'Crypt will be able to leverage Ensign's presence in Asia-Pacific to accelerate the growth of its business."

Peter Kaliaropoulos, StarHub's CEO, said: "Consolidating such domain expertise allows Ensign to project unrivalled market leadership, accelerate the development of capabilities, fuel its business growth and expand regional reach. We are excited that through this strategic alignment, StarHub will be able to tap the combined expertise of both entities to create competitive advantage for our enterprise, 5G and IoT offerings, and enable our corporate clients to benefit from digital transformation."