Kordia buys profitable cyber-security business Aura for $10M

Kordia buys profitable cyber-security business Aura Information for $10 mln

By Paul McBeth

Nov. 18 (BusinessDesk) - Kordia Group, the state-owned telecommunications and media business, has bought Wellington-based cyber-security firm Aura Information Security for $10 million, which chief executive Scott Bartlett says will immediately add to earnings.

Auckland-based Kordia today announced its acquisition of Aura Information, scaling up its own cyber-security offering which has been growing at an annual pace of about 200 percent, with an extra 25 security experts and customers in Australia, New Zealand and the US, Bartlett told BusinessDesk. The 14-year-old Aura Information is profitable, and Bartlett said it will immediately add to Kordia's earnings and free cash flow.

"Aura is the country's largest cyber-security practice, so there's quite some distance between what Aura's doing and what Kordia was doing," Bartlett said. "It's a nice profitable business, but it's also a rapidly growing business, so we think it can do both of those things at the same time: produce good returns for our shareholder, but also deliver the growth and market ambition we have for it."

Kordia has reorganised its business in recent years by expanding into data and voice services after the government decided to free up radio spectrum for newer mobile technology by axing analogue television in favour of a digital signal, ending the SOE's traditional earnings stream.

The SOE returned to profit in the 2015 financial year, generating earnings of $9.2 million on revenue of $248 million and last week declared a special dividend to the Crown of $5 million.

Bartlett said Kordia's banking facilities were undrawn and that the acquisition will be funded through the company's reserves.

Aura Information will be operated as a separate division in Kordia, which will take on all of the company's staff, while Mark Keegan and Peter Bailey will join the SOE's executive committee.

As part of the deal, Kordia will become an agent for the RedShield web application shielding service on both sides of the Tasman, provided by Aura Information's sister company, Aura RedShield Security.

(BusinessDesk)

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