Plurilock Security, a TSX Venture Exchange-listed tech company, has completed its acquisition of certain assets from India-based cloud access security broker CloudCodes for approximately $1.45 million USD.
Plurilock appears to be ramping up the frequency of its M&A deals, as the company also entered into an asset purchase agreement with Atrion Communications, a provider of consulting, professional services, and technology solutions earlier this month. In March, Plurilock also acquired Integra Networks Corporation (INC) for $1.2 million.
Continuing its active acquisition strategy, Plurilock said it plans to use a combination of debt, earn-outs, and rewards-based compensation in addition to cash and common shares to complete new acquisitions.
The asset purchase agreement with CloudCodes was initially announced in October, in which Plurilock revealed that its Indian subsidiary Plurilock Security Private Limited will obtain a technical product team and a new office in Pune, India.
Ian Paterson, CEO of Plurilock, told BetaKit that Plurilock’s acquired assets from CloudCodes include the latter’s software product, customers, and staff. He explained that the transaction was structured this way, as opposed to a full acquisition of CloudCodes, due to the “regulatory complexity in arranging the cross border transaction between Canada and India.”
Additionally, Plurilock said that CloudCodes’ integration will allow the former to expand its product line as it intends to offer CloudCodes’ CASB solution as an early-access product named Plurilock Cloud. CloudCodes’ employees are joining Plurilock’s workforce as part of the technology division.
Plurilock added that it expects Cloud to initially integrate with, and to later absorb, its existing Plurilock Adapt login authentication product.
Founded in 2011, CloudCodes provides a cloud security SaaS solution for protecting email and group collaboration platforms, offering single-sign-on (SSO), multi-factor authentication, and cloud data loss prevention solutions. According to the startup, it earned approximately $572,000 CAD in product revenue for its fiscal year ending in March.
As a result of its deal with Plurilock, CloudCodes’ client base of over 130 will have access to a larger public organization with adequate financial resources, deep security, IT, AI capabilities and expertise. Plurilock began trading on the TSXV in 2020.
Plurilock noted that CloudCodes will mark its entry into the cloud access security broker market, and Plurilock aims to expand its footprint into the global zero trust cybersecurity industry.
Launched in 2016 from the University of Victoria, Plurilock uses behavioural biometrics such as tiny patterns on the user’s keyboard and mouse movements, paired with AI to provide continuous authentication solutions, rather than login-based authentication.
In its second quarter 2022 earnings report, Plurilock saw its revenues increase because of the firms it had acquired. The company posted total revenues for the first quarter of $6.9 million compared to $75,761 for the same quarter last year.
Vancouver-based Plurilock attributed this hike to revenues generated from Aurora Systems Consulting (ASC), which Plurilock acquired last year for $1.5 million USD in cash and Plurilock shares.
When asked why Plurilock focuses on pursuing acquisitions for growth, Paterson said: “We feel that the cybersecurity market is extremely fragmented … growing through acquisitions provides a tool to provide more value to our customers than if we were limited to needing to build it all ourselves.”
Featured image from Plurilock’s website.