CensorNet buys SMS Passcode

UK security vendor CensorNet completes deal for Danish player SMS Passcode

UK cybersecurity player CensorNet has completed a "game-changer" deal for Danish multi-factor authentication vendor SMS Passcode, Channelnomics Europe, CRN's sister site, revealed this morning.

Founded in 2006, SMS Passcode claims to have more than 3,000 customers and provides a solution which authenticates users through their mobile devices and is particularly focused on the enterprise. Customers include Lego and some major Danish banks.

Ed Macnair, CensorNet's CEO, told Channelnomics Europe that the deal was made to create "the strongest cloud application control out there".

CensorNet, which delivers cloud application security, has already completed the initial integration of SMS' solution, which will be used at the front end of its offering, and the solution will then be fully combined with its own.

SMS Passcode has 500 partners globally and Macnair said the deal represents a great chance for its partners - and CensorNet's own resellers - to generate additional revenue streams through cross-sell opportunities.

"It's increasing the portfolio of products the partners can sell and the fact that both products will be integrated will give them a much more attractive offering they can take to market," he said. "We all know that cloud security is booming and this gives them the ability to capitalise on that."

Macnair also said the deal gives CensorNet a chance to expand its reach in the Nordic and central European region.

"We didn't do much in the Nordics before, so this really gives us a fantastic customer base to cross-sell into," he said. "It's an early-adoptive market and very forward thinking. Last year alone, SMS Passcode grew 70 per cent in Germany, so that whole market is very interesting for us."

The deal between the two private companies, for an undisclosed amount, is set to double CensorNet's number of employees to more than 100.

"This is a real game-changer for us," said Macnair. "It doubles the size of the business and takes us into much larger markets."

Following the deal, SMS Passcode will keep its name but will be positioned within the CensorNet brand. He said that there will be no redundancies for SMS - which employs about 50 staff - and none of its offices will be closed. The Danish firm is headquartered in Brondby, and also has offices in the US, Germany and the UK.

Last year CRN revealed that CensorNet acquired part of US email management vendor Sirrustec. Macnair suggested the latest deal would not be the last acquisition from CensorNet.

"As we find other technologies that have synergies with our own offering and can extend our capabilities, we will make acquisitions as necessary," he said.

He added that he expects CensorNet to expand into the Asia-Pacific region next, and claimed the firm is already growing rapidly in the US and now has a strong covering across Europe.