French defence company Thales has approached Tesserent (ASX: TNT), Australia’s largest listed cybersecurity company, with a proposed takeover through a court-approved scheme of arrangement. The deal, subject to shareholder approval, will see Thales Australia offer Tesserent shareholders $0.13 per share in cash, representing a significant premium of 165.3% to the last closing price. The acquisition values Tesserent at approximately $176 million and will be self-funded by Thales using its internal resources and cash reserves, which stood at $7.98 billion at the end of December.
Strengthening Thales’ Position in Cybersecurity
Thales, already a major player in the cybersecurity sector, recorded sales of $2.4 billion in that segment last year. The acquisition of Tesserent will further enhance Thales’ cybersecurity capabilities and position the company as the leading cybersecurity offering in Australia and New Zealand. Tesserent’s visual identity will be rebranded as “Cyber Solutions by Thales” following the completion of the deal. Thales employs approximately 3,800 staff across its divisions in Australia and is poised to expand its footprint in the cybersecurity market.
Attractive Premium and Benefits for Shareholders
Geoff Lord, Chairman of Tesserent, has recommended that shareholders vote in favour of the scheme of arrangement due to the attractive premium, certainty of value, and limited conditions offered by Thales. The deal provides shareholders with the opportunity to realise their investment in full for cash. Additionally, Tesserent’s staff are expected to benefit from new skill development, access to international networks, and potential career growth opportunities. Customers will also benefit from Thales’ enhanced product suite, global service capabilities, and the accelerated execution of Tesserent’s growth and customer service strategy.
Accelerating Cybersecurity Development and Expansion
Thales Australia CEO Jeff Connolly highlighted that the acquisition of Tesserent will accelerate Thales’ cybersecurity development roadmap and enable the establishment of a regional leader in cyber defence. By combining Tesserent’s team of highly-skilled cyber experts with Thales’ system engineering expertise, the company aims to better protect the country and its national infrastructure from cyber threats. The deal will provide local businesses in Australia and New Zealand with a comprehensive and sophisticated cybersecurity offering in a fragmented market.
Advisory Roles in the Acquisition
Tesserent has retained Deloitte as its financial adviser and MinterEllison as its legal adviser for the deal, while Thales is working with Azure Capital as its financial adviser and Herbert Smith Freehills as its legal adviser.
In conclusion, Thales’ proposed acquisition of Tesserent represents a significant development in the cybersecurity landscape in Australia. The deal, subject to shareholder approval, will strengthen Thales’ position in the market, provide enhanced offerings to customers, and offer growth opportunities for Tesserent’s staff. This strategic move aligns with Thales’ cybersecurity roadmap and its commitment to protecting critical national infrastructure from cyber threats.
