Optiv confirms 'temporary' UK closure and turns attention to M&A
Security giant says it is still committed to European expansion
US-based MSSP Optiv has confirmed what it called a "downsizing" of its UK operation, claiming the move is temporary as it turns its attention to M&A.
CRN reported yesterday that Optiv was in the process of shutting down in the UK, keeping on a handful of staff to continue any outstanding customer transactions.
In a statement Optiv called the move "temporary", insisting that it still has plans to build a presence in Europe and has looked at 40 European businesses to acquire before deciding it "simply couldn't justify the high valuations of these companies".
"After a comprehensive strategic review, we're temporarily downsizing our London-based organic operations," Optiv said.
"We remain committed to serving the European market, clients, partners and prospects," it added, claiming it could acquire "once European valuations right-size".
Optiv's CMO had previously said that the firm looked at acquiring the likes of SecureData and SecureLink, opting against making a bid because it thought the pair were overvalued.
SecureData was bought last year for a multiple of 20 times its EBITDA.
Micky Patel - partner at August Equity, which sold SecureData to Orange - told CRN that the SecureData and SecureLink are not a true reflection of the market as a whole.
"The two businesses that are discussed were amongst the largest independents in those markets and in the case of SecData higher than market organic growth and EBITDA margins which commanded a premium," he said.
"Combine that with being in the cybersecurity market and a trade buyer in Orange that wanted to create a European leader - the valuations were outstanding. I do not believe these multiples are a true reflection in other markets which we see are considerable lower."
Patel told CRN earlier this year that the multiple for SecureData was achieved because SecureData was unique in that it was a cybersecurity service provider that had scaled.
A panel of private equity investors also told delegates at CRN's Channel Conference MSP that they believe high multiples are here to stay.